South Korea bets $3.49 billion on building a homegrown frontier AI model to rival China's best
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South Korea is proposing a $3.49 billion investment through its 2027 budget to develop a domestic frontier AI model capable of rivaling China's leading systems. This substantial funding represents a ninefold increase from the initial 530 billion won pledged to five selected companies when the competition began. The government plans to launch an open competition that includes startups, rather than automatically awarding funds to current finalists LG AI Research, SK Telecom, and Upstage. Officials acknowledge that while South Korea cannot compete with major US tech giants, it aims to match the quality of top Chinese open models. A secondary funding track will support the adoption of these Korean-built models across the national economy. This initiative follows recent infrastructure deals between Samsung, SK, and OpenAI, as well as a massive push for chip production involving Samsung and SK Hynix. Despite these industrial efforts, Korean consumers have historically spent more on foreign AI subscriptions like ChatGPT than on local services.
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