South Korea is set to make a significant stride in artificial intelligence (AI) with a substantial investment of nearly $7 billion by 2027, announced President Yoon Suk-yeol on Tuesday.

The country, known for housing technology giants like Samsung and SK Hynix, aims to reinforce its position as a global leader in cutting-edge semiconductors, particularly those powering AI systems, as reported by Daily Tribune.

President Yoon emphasized the critical role of the semiconductor industry in South Korea’s export-driven economy. Speaking at a high-level meeting attended by officials and tech sector executives, he outlined plans for South Korea to take the lead in AI chip development.

“It is no exaggeration to say that the future of the semiconductor industry depends on AI,” President Yoon remarked.

He announced a substantial investment of 9.4 trillion won ($6.94 billion) in AI and AI semiconductor fields by 2027. Additionally, a separate fund of 1.4 trillion won ($1 billion) will be established to support the growth of innovative AI semiconductor companies.

Notable representatives from Samsung, SK Hynix, tech giant Naver, and AI chip startup SAPEON were present at the meeting, according to President Yoon’s office.

Semiconductors serve as the backbone of the global economy, powering various devices ranging from household appliances to advanced AI systems. The surge in demand for advanced chips, particularly those driving AI technologies, has been notable in recent years.

South Korea’s move comes amidst heightened geopolitical tensions, with Seoul and Tokyo striving to boost domestic chip production to counter the dominance of Silicon Valley’s Nvidia. President Yoon emphasized South Korea’s ambition to lead in AI technology beyond memory chips and to establish dominance in the future AI chip market.

“The semiconductor competition taking place now is an industrial war and an all-out war between nations,” President Yoon stated.

South Korea’s commitment to AI advancement aligns with global trends, with nations like the United States, Japan, and China also announcing significant investments in semiconductor industries to secure technological sovereignty and global competitiveness.