South Korea is planning to triple its artificial intelligence (AI) budget next year to over 10 trillion won ($7.2 billion), as President Lee Jae Myung’s government seeks to accelerate AI adoption across industries including robotics, automotive, healthcare, and public services.
Finance Minister Koo Yun-cheol, unveiling the 2026 budget on Friday, said the government will spend 2 trillion won to purchase 15,000 graphics processing units (GPUs), essential for AI computing. The plan also includes funding to nurture 11,000 AI experts at 24 graduate schools, alongside a 375 billion won investment fund to support AI startups.
“It’s an era of AI transformation,” Koo said. “If we are left behind in applied AI, we have no future. Most of the increased budget is allocated to R&D, AI, and advanced industries, which will boost the nation’s growth potential.”
The announcement comes amid global competition for AI dominance, driven by companies like OpenAI, Google, and DeepMind. South Korean firms such as LG and Naver are aiming to catch up by developing domestic generative AI models.
The Lee administration, which took office in June, plans to raise overall research and development spending by 19.3% to 35.3 trillion won, reversing cuts made under the previous Yoon Suk Yeol government that drew criticism from researchers and opposition parties.
The proposed 2026 defense budget is 66.3 trillion won, up 8.2% from this year, reflecting U.S. pressure on allies to raise military spending to 5% of GDP, which includes purchasing more South Korean weapons. Overall, the national budget is projected to rise 8.1% to 728 trillion won, pushing the country’s debt-to-GDP ratio above 50% for the first time. The budget will be reviewed and approved by the National Assembly, where Lee’s Democratic Party holds a majority.
Critics warn that the expanded AI spending could disproportionately benefit large conglomerates and online platforms, reinforcing technological monopolies and economic concentration. Civic group People’s Solidarity for Participatory Democracy said, “Without sufficient safeguards for fair economic structure, personal data protection, or safety regulations, such investments may support large corporations rather than foster an innovation ecosystem.”
