Artificial Intelligence in South Korea

Introduction

South Korea stands at a pivotal juncture in the global artificial intelligence (AI) landscape. With a robust digital infrastructure, world-class semiconductor industry, and a government committed to technological leadership, the nation has articulated an ambitious vision: to become one of the top three global AI powerhouses—an “AI G3” nation—within the next decade^{1, 2}. This report provides a comprehensive overview of the current state of AI in South Korea as of late 2025, examining the national strategy and policy framework, flagship projects and infrastructure, funding and investment trends, regulatory and governance developments, security and national defense considerations, the ecosystem of research institutions and universities, leading companies and startups, sectoral applications and innovations, international collaborations, ethical and societal impacts, legal disputes, challenges, and future directions.

National AI Strategy and Government Policy Framework

Vision and Strategic Objectives

South Korea’s AI policy is anchored in the vision of “emerging as one of the top three AI powerhouses to become a Global Pivotal State.” This vision was formalized at the inaugural meeting of the National Artificial Intelligence Committee in September 2024, chaired by President Yoon Suk Yeol, and is underpinned by a comprehensive blueprint for national AI innovation^{1, 3}. The government’s approach is characterized by a paradigm shift from incremental infrastructure expansion to a holistic, all-of-nation mobilization, integrating public and private sector efforts to drive AI transformation across the economy and society.

Four National AI Flagship Projects

The National AI Strategy is operationalized through four flagship projects:

• Expansion of National AI Computing Infrastructure: Establishment of a National AI Computing Center, expansion of GPU capacity by 15 times (to over 2 exaflops by 2030), and support for commercialization of domestic AI chips^{4, 5}.
• Substantial Increase in Private Sector AI Investment: Mobilization of KRW 65 trillion (approximately $49 billion) in private investment over 2024–2027, with government incentives and policy support³.
• Nationwide AI Transformation (AI+X): Achieving 70% AI adoption in industry and 95% in the public sector by 2030, with tailored AI+X strategies for key sectors such as manufacturing, healthcare, and finance⁶.
• Securing AI Safety, Security, and Global Leadership: Establishment of the AI Safety Research Institute, enactment of the AI Basic Act, and leadership in global AI governance and standards⁷.

Policy Directions Across the AI Ecosystem

The strategy is further structured around four key policy directions:

• Fostering Startups and Talent: Nurturing 10 AI unicorns and 200,000 AI professionals by 2030.
• Innovating Technology and Infrastructure: Advancing AI semiconductors, on-device AI, and regulatory reforms to support generative AI and data utilization.
• Creating a Culture of Inclusiveness and Fairness: Enacting the Digital Inclusion Act and ensuring equitable access to AI benefits.
• Securing Global Leadership: Expanding international cooperation, promoting the Seoul Declaration, and establishing global research platforms⁸.

Implementation and Governance

The National AI Committee, chaired by the President and comprising senior government officials and private sector experts, serves as the central platform for policy development and implementation. Specialized subcommittees and dedicated support teams ensure sectoral coordination and execution of detailed initiatives³.

Table 1: Summary of Major National AI Policy Initiatives

Elaboration: These initiatives collectively represent South Korea’s multi-pronged approach to AI leadership. The National AI Computing Center and GPU expansion address the critical bottleneck of compute resources, while the AI Basic Act and AI Safety Research Institute establish a legal and institutional framework for safe and trustworthy AI. The Digital Bill of Rights and Seoul Declaration reflect Korea’s ambition to shape global digital norms, and the AI+X transformation aims to mainstream AI across all sectors of the economy and society^{1, 9, 8}.

National AI Flagship Projects and Infrastructure

National AI Computing Center and GPU Expansion

A cornerstone of Korea’s AI strategy is the establishment of a National AI Computing Center, with a public-private investment of up to KRW 4 trillion ($2.86 billion)⁴. The center will provide world-class AI computing resources to researchers, startups, and industry, addressing the acute shortage of high-performance GPUs that has hampered domestic AI development. As of late 2025, Korea has secured a landmark deal to acquire 260,000 Nvidia Blackwell GPUs, raising its total AI chip stock to over 300,000 units—third globally after the US and China⁵. Of these, 50,000 GPUs are earmarked for the National AI Computing Center, with the remainder distributed among major conglomerates and cloud providers.

This expansion is expected to catalyze the training of large-scale language models, support AI research across sectors, and reduce reliance on foreign cloud platforms. However, it also poses challenges in terms of energy consumption, sustainability, and infrastructure management, prompting parallel investments in power grid expansion and green data centers².

Domestic AI Chips and Semiconductor Ecosystem

South Korea leverages its global leadership in memory semiconductors to foster a domestic AI chip ecosystem. Startups such as Rebellions and FuriosaAI, in partnership with Samsung Electronics, are developing next-generation AI chips (e.g., the “Rebel” chip on Samsung’s 4nm process with HBM3E memory)¹⁰. The government supports commercialization and export of domestic AI chips, aiming to reduce dependence on foreign suppliers and position Korea as a hub for AI hardware innovation.

Industrial AI Platforms and Data Integration

The Ministry of Trade, Industry and Energy (MOTIE) is driving the diffusion of AI in manufacturing through the “AI+X” (AX) initiative, targeting a 70% corporate AI deployment rate and 40% adoption in manufacturing by 2030⁶. Over 300 anchor projects are planned to integrate AI solutions, robotics, and equipment into industrial processes. MOTIE is also developing sectoral data integration platforms, such as a carbon data platform for high-emission industries, to support AI-driven sustainability and supply chain optimization.

Government Funding, Investment Targets, and Private Sector Commitments

Public and Private Investment Landscape

The Korean government has committed substantial funding to AI R&D, infrastructure, and talent development. For 2025, the national budget allocates KRW 1.8 trillion to AI, up from KRW 1.4 trillion in 2024, with additional multi-year investments planned for flagship projects⁴. The private sector has pledged KRW 65 trillion in AI investment over 2024–2027, with major conglomerates (Samsung, SK, Hyundai, Naver, Kakao, LG) leading the charge².

To stimulate investment, the government offers tax incentives, low-interest loans, and policy funds, including a KRW 14 trillion financing program for semiconductor manufacturers and AI firms. The “AI computing access fund” and “permit timeout system” are proposed to accelerate data center construction and streamline administrative procedures².

Venture Capital and Startup Funding Trends

Global corporate venture capital (CVC) investment has rebounded in 2025, with AI and healthcare startups attracting the lion’s share of funding. Korean venture investment in unlisted startups and SMEs reached KRW 5.29 trillion ($3.9 billion) between January and October 2025, though early-stage funding remains subdued¹¹. The government’s “Top Four Venture Nations” strategy aims to reignite early-stage liquidity and position Korea as a regional bridge for deep-tech startups.

AI Legislation, Regulation, and Governance

The AI Basic Act: A Comprehensive Legal Framework

In December 2024, the National Assembly passed the “Basic Act on the Development of Artificial Intelligence and the Establishment of Foundation for Trustworthiness” (AI Basic Act), making South Korea the second country after the EU to enact comprehensive AI legislation^{1, 2, 7}. The Act, effective January 2026, consolidates 19 separate AI bills into a unified framework covering:

• National AI governance and strategy (AI Master Plan, National AI Committee)
• Industry support (R&D, data centers, clusters, SME/startup support)
• Safety, transparency, and accountability for high-impact and generative AI
• AI ethics, human rights, and digital inclusion
• Incentives for foreign AI talent and requirements for foreign AI companies to designate local representatives

The Act introduces a risk-based regulatory approach, with stricter obligations for “high-impact AI” (e.g., healthcare, transportation, public services) and generative AI, including transparency, user notification, risk management, and explanation mechanisms^{1, 3}. It also establishes the AI Safety Research Institute as a specialized agency for risk assessment and certification.

Regulatory Challenges and Industry Concerns

While the AI Basic Act is lauded for its innovation-friendly and flexible approach, concerns remain regarding the vagueness of definitions (e.g., “high-impact AI”), potential overlaps with existing laws, and the scope of government investigative powers. The Ministry of Government Legislation is conducting a comprehensive review to harmonize the Act with other statutes and clarify enforcement details^{1, 3}.

Data Protection and Privacy Guidelines

The Personal Information Protection Commission (PIPC) has issued guidelines on automated decision-making, data subject rights, and the lawful use of disclosed personal information for AI training under the Personal Information Protection Act (PIPA). These guidelines provide practical standards for companies operating AI systems and clarify the legal basis for AI data utilization.

AI Security and National Security Policy

National Security and AI Risk Management

AI’s dual-use nature—its potential for both civilian and military applications—poses complex security challenges. South Korea has integrated AI security into its national defense planning, adopting the UN resolution on safe, secure, and trustworthy AI and launching the National AI Security Consultative Group in March 2025. The National Security Office and National Intelligence Service (NIS) coordinate cybersecurity and threat response, while the AI Safety Research Institute addresses broader safety and risk issues.

However, the AI Basic Act explicitly excludes national defense and security uses of AI from its scope, leaving a gap in legal and strategic frameworks for military AI. Unlike the EU AI Act, which applies a four-level risk classification, Korea’s framework minimizes regulation for most low-risk systems, raising concerns about potential vulnerabilities.

Export Controls and International Security Cooperation

US and UK policies on AI as a national security asset, export controls on advanced AI chips, and the expansion of the US Entity List have direct implications for Korea’s semiconductor industry and AI technology exports. Korea faces indirect pressure to align with allied export regulations, which could affect its ability to secure computing infrastructure and maintain supply chain resilience.

To address these challenges, Korea is strengthening policy and technical cooperation with allies, participating in global AI safety assessment frameworks, and considering the establishment of a dedicated institution for national security AI.

Major Research Institutions and National Labs

Leading National Research Institutes

South Korea’s AI research ecosystem is anchored by a network of national labs and institutes that drive foundational and applied research, technology transfer, and industry collaboration. Key institutions include:

• KAIST (Korea Advanced Institute of Science and Technology): Home to the Kim Jaechul Graduate School of AI, KAIST is a global leader in AI research, ranking 5th worldwide in machine learning conference publications (ICML, NeurIPS, ICLR) from 2020–2024¹⁴. Its research spans large language models, neuromorphic chips, robotics, autonomous vehicles, and precision medicine.
• KIST (Korea Institute of Science and Technology): Focuses on strategic AI development, robotics, and interdisciplinary applications.
• KISTI (Korea Institute of Science and Technology Information): Operates the APOLLO AI-based R&D commercialization platform and leads the Global ASTI 2025 initiative for international R&D collaboration¹⁵.
• KDI (Korea Development Institute): Provides policy research and analysis on AI trends and economic impacts.
• UNIST, DGIST, GIST: Science and technology institutes with strong AI research programs, particularly in AI+X applications and technology transfer.

Table 2: Major AI Research Institutions in South Korea

Elaboration: These institutions form the backbone of Korea’s AI R&D ecosystem, bridging basic research, applied innovation, and industry commercialization. Their collaboration with universities, startups, and global partners is central to Korea’s strategy of integrating research excellence with economic impact¹⁵.

Top Universities and the AI Talent Pipeline

University Rankings and AI Programs

South Korea boasts a dense network of universities with strong AI research and education programs. According to EduRank and US News, the top institutions for AI in South Korea include¹⁶:

1. KAIST (Daejeong): #1 in Korea, #82 globally for AI research
2. Seoul National University (SNU) (Seoul): #2 in Korea, #85 globally
3. Yonsei University (Seoul): #3 in Korea, #179 globally
4. Korea University (Seoul): #4 in Korea, #207 globally
5. Pohang University of Science and Technology (POSTECH) (Pohang): #5 in Korea, #305 globally

AI Degree Programs and Graduate Output

KAIST’s Kim Jaechul Graduate School of AI, established in 2019, offers MS, integrated MS/PhD, and PhD degrees in AI, with a curriculum covering machine learning, deep learning, robotics, NLP, computer vision, ethics, and AI for healthcare¹⁸.

The government aims to nurture 200,000 AI professionals by 2030 (up from 51,000 in 2023), with initiatives to globalize and generalize AI talent development, expand AI-focused tracks in STEM high schools, and attract foreign experts through incentives and special visa policies².

Table 3: Top AI Universities in South Korea (2025)

Elaboration: These universities are not only research powerhouses but also key contributors to the national AI talent pipeline. Their graduates populate leading companies, startups, and research institutes, driving Korea’s AI innovation ecosystem^{16, 17}.

Leading Companies and Conglomerates in AI

Major Conglomerates

South Korea’s chaebols (conglomerates) are at the forefront of AI development and deployment:

• Samsung Electronics: Integrates AI across semiconductor manufacturing, consumer electronics, and mobile devices. Develops proprietary generative AI models (e.g., Gauss), invests in AI chips, and partners with startups like Rebellions for next-generation AI hardware¹⁰.
• Naver: Operates HyperCLOVA and HyperCLOVA X, Korea’s largest hyperscale language models. Leads in AI-powered search, cloud, and content platforms. Faces ongoing legal disputes over AI training data and copyright¹⁹.
• Kakao: Develops AI for chatbots, content, fintech, and mobility services. Invests in AI startups and cloud infrastructure.
• LG Group: Applies AI in manufacturing, home appliances, and automotive electronics. Develops AI chips and smart factory solutions.
• Hyundai Motor Group: Integrates AI in autonomous vehicles, robotics, and smart manufacturing.

AI Startups and Scaleups Ecosystem

South Korea’s AI startup ecosystem is vibrant and diverse, with over 200 companies tracked as of November 2025. Notable startups and scaleups include:

• Rebellions, FuriosaAI: AI chip startups.
• Lunit, Deep Bio, DeepNoid, AITRICS: Medical AI for diagnostics and healthcare.
• MakinaRocks: Industrial AI solutions for manufacturing optimization.
• Stradvision: AI for autonomous vehicles and computer vision.
• QANDA (Mathpresso): AI-powered education and assessment platforms.

Table 4: Representative AI Companies and Startups in South Korea (2025)

Elaboration: These companies exemplify Korea’s strengths in both hardware (semiconductors, robotics) and software (LLMs, medical AI, industrial AI). The ecosystem is supported by active venture capital, corporate investment, and government-backed innovation programs, though the emergence of domestic AI unicorns remains a key policy goal¹¹.

AI Applications and Sectoral Adoption

Healthcare and Digital Health

AI is revolutionizing Korea’s healthcare sector, driving the transition to “Healthcare 4.0” and personalized medicine²⁰. Key developments include:

• Digital Health and Bio Big Data: The National Integrated Bio Big Data Initiative aims to collect genomic, clinical, and public health data from one million participants by 2032²¹.
• AI Diagnostics and Medical Devices: Companies like Lunit develop AI algorithms for cancer screening, radiology, and clinical decision support.
• Hospital Robotics: Hospitals deploy service robots for medication delivery and patient guidance²².

Manufacturing and Industry 4.0

AI adoption in manufacturing is a national priority, with the AI+X initiative targeting a 70% deployment rate by 2030⁶. Applications include smart factories, AI-driven predictive maintenance, and the integration of AI chips in industrial automation.

Education and Workforce Development

AI is transforming education through digital textbooks, personalized learning, and workforce reskilling:

• AI Digital Textbooks: Starting in 2025, 76 AI digital textbooks will be introduced in elementary and secondary schools for English, math, and coding²³.
• Teacher Training: The Ministry of Education is training 160,000 teachers and upgrading digital infrastructure.

Digital Health, Bio Big Data, and mRNA Initiatives

The National Integrated Bio Big Data Initiative, launched in December 2024, is a flagship project to collect and integrate clinical, genomic, and public health data from one million participants by 2032²¹. In parallel, Korea is accelerating mRNA vaccine technology development to establish a rapid-response platform for future pandemics.

International Collaboration, Export Strategies, and the Global ASTI 2025 Initiative

Global R&D Collaboration and Export Growth

South Korea is repositioning itself as a global R&D partner through the Global ASTI 2025 initiative, led by KISTI¹⁵. The initiative integrates AI tools and data platforms (e.g., APOLLO) to connect research institutions across borders, accelerating technology commercialization and SME export readiness.

Leadership in Global AI Governance

Korea actively shapes global AI norms through the Seoul Declaration (May 2024), the Digital Bill of Rights (September 2023), and participation in international forums (UN, OECD, G7, GPAI)⁸. The government promotes interoperability of AI governance frameworks and international cooperation on AI safety.

AI Ethics, Public Trust, and Societal Impacts

The Digital Bill of Rights articulates five principles for a digital society: freedom and rights, fair access, safety and trust, innovation, and well-being for all⁹. The Seoul Declaration commits global leaders to risk-based governance and the advancement of human-centric AI⁸. The AI Basic Act mandates the establishment of AI ethics committees and measures to ensure transparency, prevent discrimination, and promote digital literacy^{1, 2}.

Recent Legal Disputes and Intellectual Property Issues

Naver Copyright Lawsuit and AI Training Data

In January 2025, Korea’s three terrestrial broadcasters filed a landmark copyright lawsuit against Naver, alleging unauthorized use of news content for training its generative AI platforms (HyperCLOVA and HyperCLOVA X)¹⁹. This case is expected to shape future legislative frameworks regarding AI training data, copyright, and compensation for content creators.

AI as Inventor/Author and Patent Law

Korea maintains that AI cannot be recognized as an inventor or author under current patent and copyright law, a position upheld by recent court rulings that nonetheless acknowledge the need for legislative updates.

Challenges and Risks

• Compute Shortage and Infrastructure Bottlenecks: Challenges in scaling AI computing infrastructure, managing energy consumption, and ensuring sustainable data center operations².
• Talent Gap and Workforce Development: A persistent shortage of AI talent, requiring sustained investment to meet the 200,000 professional goal by 2030².
• Private Investment Levels and Market Size: Private investment is lower than in leading countries, posing challenges for attracting global capital and fostering unicorns¹¹.
• Cybersecurity and National Security: Lack of a comprehensive legal framework for military/security AI and fragmented agency roles.
• Legal Uncertainties and Regulatory Ambiguity: Vagueness in the AI Basic Act and evolving legal disputes create uncertainty for businesses.

Future Directions and Scenarios

AI G3 Roadmap and Metrics for Success

South Korea’s AI G3 roadmap envisions achieving top-three global status in AI compute capacity, research output, and industrial adoption by 2030. Key targets include nurturing 10 AI unicorns, 200,000 AI professionals, and reaching 70% AI adoption in industry¹.

Policy and Institutional Reforms

Key priorities include: sustaining investment, accelerating regulatory reform to harmonize the AI Basic Act, strengthening security frameworks, and enhancing international collaboration through the Global ASTI initiative.

Innovation and Export Strategies

Korea aims to leverage its strengths in semiconductors, digital health, and industrial AI to expand exports and become a trusted global partner. Integration of AI with quantum, biotech, and space technologies is also a future focus.

Conclusion

South Korea’s AI ecosystem is at an inflection point, marked by bold policy initiatives, rapid infrastructure expansion, world-class research, and a vibrant industry landscape. The nation’s ambition to become an **AI G3 powerhouse** is supported by a comprehensive strategy that balances innovation, safety, inclusiveness, and global leadership. However, realizing this vision will require sustained investment, regulatory clarity, talent development, and adaptive governance to navigate the complex challenges of the AI era. As Korea continues to shape the future of AI at home and abroad, its experience offers valuable lessons for other nations seeking to harness the transformative power of artificial intelligence.