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South Korea’s president proposes $7b AI investment in 2026 budget
South Korean President Lee Jae Myung has announced plans to prioritize AI in the country’s economic and policy strategy, pledging a significant increase in AI investment for 2026.
Lee presented his first budget address to parliament since taking office in June, proposing a 10.1 trillion won (US$7 billion) AI investment as part of a 728 trillion won (US$510 billion) budget for next year.
The plan includes expanding AI use in sectors such as robotics, automobiles, semiconductors, logistics, biotech, public health, education, and taxation, as well as increasing computing capacity and advanced AI training.
South Korea also aims to raise its defense budget by 8.2% to 66.3 trillion (US$46 billion) won, with a portion allocated for AI integration in military technology.
The budget proposal follows recent political tensions, with the main opposition party boycotting the address in protest over an arrest warrant for a former finance minister.
🔗 Source: Bloomberg
🧠 Food for thought
Implications, context, and why it matters.
2026 AI budget splits between infrastructure and adoption
- The announced 10.1 trillion won AI spend is set for 2026, and it covers 2.6 trillion won toward adoption across private industries and public services 1.
- Another 7.5 trillion won goes to infrastructure, including GPU purchases aimed at a 35,000-unit national target, AI-skilled worker programs and research funding 1.
- The government pledged 6 trillion won over five years for robotics, autos, shipbuilding and semiconductors starting in 2026 1.
- Spending on AI will more than triple to 10.1 trillion won in 2026 versus 2025 1.
Next-Generation KONEPS will consolidate public AI tenders
- Korea will merge 25 separate public institution e-procurement systems (digital government purchasing) into one Next-Generation KONEPS (the national online procurement portal) using AI, big data and cloud computing 2.
- Roughly 100 billion won went into rebuilding KONEPS from June 2021 through March 2025 2.
- KONEPS runs competitive bidding with real-time tender disclosures and has supported about 110,000 mostly small supplier businesses 3.
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