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South Korea pushes for AI semiconductors as international demand grows

The South Korean government has made no secret of its ambition to be a key player in the global artificial intelligence industry, including the manufacture of semiconductors for AI functions.

This week, the country's information and communication technology regulator announced plans to develop up to 50 types of AI -focused system semiconductors by 2030, reported the news agency Yonhap. The government will be looking for thousands of local experts to lead the new wave of innovation.

South Korea has recently made several pledges to support next-generation chipmakers. For example, earlier this year it announced plans to spend approximately 1 trillion won ($ 870 million) on the marketing and production of AI chips before 2029. Last year, President Moon Jae-in announced his "Presidential Initiative for AI" to raise public awareness of the industry.

These efforts are driven by the growing demand for AI-related chips, which McKinsey estimates make up nearly 20% of total semiconductor demand and could generate sales of around $ 67 billion by 2025.

Two of the world's largest manufacturers of memory chips are already based in South Korea – Samsung and SK hynix. While this is a lucrative industry, it relies more on the manufacturing process than on core technologies, noted Seewan Toong, an independent IT industry expert.

"It's about making the chip smaller, denser, more efficient and putting more memory on a chip," he added.

According to Yonhap, the country wants to make its semiconductors smarter and promises to own 20% of the global AI chips market by 2030.

Samsung was delving into next-generation chips when it became the mass production partner for Baidu's AI chips late last year. In July, the conglomerate announced the hiring of 1,000 new employees to work on chips and AI. SK hynix has chosen its own Chinese ally by supporting Horizon Robotics, an AI chip designer who was last valued at $ 3 billion.

China, which has long focused on the application of AI rather than basic research, has similarly provided government funding to domestic semiconductor companies as the country suffers from US sanctions on core technologies. The question is how many startups with government support will survive to compete with global giants like Nvidia and Qualcomm.

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