The South Korean government recently set a goal to develop 50 new artificial intelligence (AI) system semiconductors by 2030. Seoul revealed it would dedicate ₩70 billion ($60.8 million) to help local chipmakers meet its objective. Local officials hope to capture 20 percent of the AI component market by the time their program ends.
Last month, the nation unveiled plans to spend ₩1 trillion ($843.9 million) to become the world’s AI chip hub by 2029.
Details of South Korea’s New AI Chip Initiative
South Korea’s Ministry of Science and ICT (Information and Computer Technology) will spearhead the nation’s new AI semiconductor initiative.
The agency intends to develop the technological resources necessary for advanced chip research by 2022. The government organization also intends to have 3,000 AI component experts ready to lead the field within 10 years. It is directing funding to local chipmakers for recruitment and corporate acquisitions to fulfill its new mission.
South Korean President Moon Jae-in publicly announced the sector would be part of his country’s ongoing national strategy in 2019.
Why South Korea Wants to Lead the World in AI Chip Development
One reason South Korean officials want to establish their country as a leader in the AI semiconductor space is the massive potential payoff.
McKinsey, a global consulting firm, estimates the sector will be worth $67 billion by 2025. The group also reported the segment would experience a compound annual growth rate (CAGR) of 18 to 19 percent through the next five years. By comparison, it anticipates the non-AI component market will have a 3 to 4 percent CAGR in the same period.
Seoul also understands the transformational potential of next-generation AI components.
Companies will soon utilize on-chip machine intelligence to power self-driving cars, facial recognition systems, and natural language translation programs. Corporations are also likely to use the technology to accelerate their financial risk analysis and transportation route planning tasks.
Countries that pioneer those sectors will attract the best engineers and the largest financial investments.
The South Korean government sees an opportunity to raise its stature and gross domestic product by betting on AI chips. As McKinsey predicts that type of semiconductor will represent 20 percent of the overall market within five years, Seoul is making a sensible investment.