(LEAD) Science ministry vows quadrillion-won investment in AI data centers

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SEOUL, June 29 (Yonhap) — South Korea will push for the investment of over a quadrillion won (US$650 billion) in the construction of artificial intelligence (AI) data centers by 2035, the science minister said Monday.

Minister Bae Kyung-hoon unveiled the plan during a national investment briefing chaired by President Lee Jae Myung at Cheong Wa Dae, emphasizing that ample data is important for South Korea to secure a leading position in the global physical AI race.

“The next three years will be the golden time to become the No. 1 in the area of physical AI,” Bae said. “The government will lead the physical AI sector, by designating it as a national strategic industry.”

Under the plan, an initial investment of 550 trillion won will be spent to build 8.4 gigawatts (GW) of AI data centers by 2029. The ministry will gradually expand the infrastructure by 10 GW until 2035, Bae said.

Infrastructure will be concentrated in non-capital areas for balanced regional development, he added.

“Global investment earmarked for data centers over the next five years is US$5.5 trillion, or 8.4 quadrillion in Korean won,” Bae said, quoting Nvidia’s chief Jensen Huang, that the current AI boom is the “largest infrastructure build up in human history.”

The minister also stressed the importance of localizing equipment and solutions used in the data centers, as he vowed to support the sector through tax breaks and the formation of a cluster ecosystem, as well as ultra-large test labs, used to optimize and validate AI models.

Once the data infrastructure is in place, the science ministry plans to develop a general-purpose foundation model for physical AI in the next three years, based on a world model, or AI tools that understand the dynamics of the real world.

“We will develop a sustainable growth strategy for South Korea by using Physical AI to boost productivity in key industries by 20 percent and create a significant competitive edge,” Bae said.