THE ESSENTIALS IN 30 SECONDS

  • The 2027 budget bill totals a record 820.9 trillion won, 12.8% more than 2026, and must be passed by December 2.
  • AI and three megaprojects (semiconductors, physical AI, AI data centres) get 21.3 trillion won, nearly double this year, including 4.7 trillion won for frontier models.
  • A proposed 162 trillion won fund would be financed by windfall tax revenue from the chip boom; the main opposition says it drains state coffers.

South Korean President Lee Jae Myung asked the National Assembly on Monday, November 2, to approve a record 2027 budget built around artificial intelligence. In his budget address, he said the government would invest boldly in AI and other future growth engines, and he asked lawmakers to pass the 820.9 trillion won plan, 12.8% larger than this year's, by the legal deadline of December 2.

Where the AI money goes

Lee said 21.3 trillion won would go to AI and three "megaprojects": semiconductors, physical AI and AI data centres. He described the amount as nearly double this year's level. Seoul Economic Daily reported part of the breakdown:

  • 4.7 trillion won for frontier AI, meaning homegrown models meant to compete with the best-performing systems worldwide;
  • 2 trillion won, through a new special account, to expand chip production capacity, including fabs around Seoul and a cluster in the southwest;
  • 2.1 trillion won for power, water and industrial-park infrastructure, so that companies do not miss investment windows;
  • 500 billion won to demonstrate physical AI in eight public and private sectors, including manufacturing and defence.

The report does not itemise the remaining 12 trillion won or so. Other lines include an "AI for All" plan for public-service AI agents, training for 2,000 chip-design specialists, a record 39.5 trillion won for research and development, and 13.8 trillion won for ten next-generation strategic technologies.

A fund paid for by the chip boom

Lee also promoted a proposed 162 trillion won (about $120.5 billion) fund financed by windfall tax revenue from semiconductor exports, according to The Korea Times. He said it would support young people, growth industries, regional economies and skills, while smoothing swings in tax income.

Political fight ahead

The ruling Democratic Party pledged to pass the budget on time. The main opposition People Power Party accused the government of spending recklessly, citing about 1,400 trillion won of existing state debt on top of the new fund. The bill will now go through parliamentary review, so the AI amounts could still change before December.

The plan ties South Korea's AI ambitions to revenue from a chip industry known for its cycles.