The unstoppable run of artificial intelligence — especially since OpenAI’s launch of its hugely successful chatbot, ChatGPT in November 2022 — is bringing about upheavals in the tech world and markets, while becoming a driving force across the global economy.
Riding high on the unparalleled global AI boom, Republic of Korea plans to invest nearly $1.2tn - equivalent to more than two-thirds of its GDP — in a new chip-building hub and AI data centres over several years. The enormous cash injection comes as Asia’s fourth-largest economy bets heavily on the technology with Korean memory chipmakers emerging as a crucial cog in the fast-moving industry.
“Speed is the only path to survival. We must secure the core elements of artificial intelligence faster than any other nation,” President Lee Jae Myung said in Seoul.
Samsung Electronics and SK Hynix will make a record investment of 800tn won (around $520bn) in a new semiconductor fabrication hub in the country’s southwest, the government said.
Both companies have seen profits and share prices skyrocket in recent months, as frenzied demand for AI infrastructure squeezes the global supply of memory chips.
The government also announced a separate investment of a quadrillion won (around $650bn) in AI data centres over the next 10 years.
Samsung Electronics and SK Hynix are also making one of the biggest bets yet on the AI boom with investments worth hundreds of billions of dollars, but the planned capacity buildout is stoking fears of a painful reckoning if AI spending cools.
Together, the world’s two biggest memory chipmakers have pledged 3,200tn won ($2.07tn) of investment, encompassing a new 800tn won chip cluster in the country’s southwest as well as previously announced projects. Shares of SK Hynix and Samsung Electronics have gone up 307% and 179%, respectively, so far this year.
The announcement comes as customers ranging from AI hyperscalers to electronics makers such as Apple press for more memory chips amid a global shortage. But analysts note that chip plants take years to build and ramp up, meaning much of the new capacity will not arrive until well into the next decade.
The memory chip boom also remains reliant on whether AI hyperscalers would keep expanding at the current rate. The soaring profitability of Samsung and SK Hynix’s memory businesses is a relatively recent phenomenon, driven by the global AI boom. Past downturns in chip prices have badly hit the companies, causing SK Hynix to flirt with bankruptcy in 2001 and driving both firms to post big losses in 2023.
Still analysts believe the companies would learn from past cycles.
“A downturn in the memory industry is clearly a risk to the plan,” CLSA senior analyst Sanjeev Rana said. But “memory producers retain the flexibility to adjust their investment pace if signs of excess capacity emerge.”
Global AI adoption continued to rise in the second half of 2025, increasing by 1.2 percentage points compared to the first half of the year, with roughly one in six people worldwide using generative AI tools, according to a Microsoft report.
As AI advances, global governance, international collaboration and knowledge-sharing are becoming essential for effective and responsible adoption.
Looking forward, these efforts will be critical in addressing the gaps in technology governance, as more countries formalise AI strategies and strengthen their capacity to adopt the technology effectively.