Recently, South Korean President Lee Jae-myung issued an "Artificial Intelligence (AI) Declaration" during his visit to the United States and enthusiastically promoted a national-level mega science and technology innovation project called the "Three Major Super Projects for the Great Leap Forward of the Republic of Korea," with a total investment of up to $576 billion. South Korean and American companies also finalized a long-term AI semiconductor cooperation framework worth $950 billion on the spot. This grand vision, hailed by the media as the "Korean version of Silicon Valley," focuses on "cutting-edge semiconductors," "physical AI," and "ultra-large AI data center clusters." It plans to build four large-scale wafer fabs in Gwangju, in the southwestern region, led by Samsung Electronics and SK Hynix, while simultaneously creating large-scale AI data centers. The goal is to become an "irreplaceable core country in the AI supply chain" by 2030. South Korea is attempting to leverage its advantages in memory chips to replicate Silicon Valley's innovation ecosystem, bind with U.S. AI giants, and hedge against competitive pressures in the AI industry. This all-in strategic layout harbors both opportunities for industrial breakthroughs and structural risks that are difficult to avoid, which will profoundly impact the East Asian semiconductor and AI competition landscape.
Objectively speaking, South Korea has a relatively solid industrial foundation for the "Korean version of Silicon Valley." Currently, South Korea holds over 80% of the global market share in High Bandwidth Memory (HBM), and companies like SK Hynix have become important links in the AI computing chip supply chain. This time, South Korea adopts a "government-led, conglomerate-driven" model, where the government provides land, fiscal and tax support, and infrastructure, while semiconductor giants invest huge sums to expand production. Combined with long-term supply agreements with Nvidia and Broadcom, they lock in core overseas orders for the next few years. This vision carries multiple strategic considerations for South Korea: on one hand, by tilting industrial布局 towards the economically weaker southwestern region, it aims to balance the overload of scientific innovation resources in the capital area and fulfill campaign promises; on the other hand, it proposes building a U.S.-South Korea technology alliance, innovation alliance, and entrepreneurship alliance, actively embedding into the U.S.-led "Silicon Peace" mechanism to strengthen the U.S.-South Korea industrial alliance, respond to external pressures from Japan's advanced equipment and materials competition and the rapid rise of China's semiconductor and AI industries, and compete for global discourse power in the Fourth Industrial Revolution.
Objectively, building a "Korean version of Silicon Valley" from the top down naturally has inherent shortcomings. As is well known, the soul of Silicon Valley innovation is not chip factories, but a free and open entrepreneurial atmosphere, a diverse and active venture capital ecosystem, and a cultural soil that encourages experimentation and innovation. In contrast, South Korea's industrial ecosystem heavily relies on the conglomerate system, with resources, technology, and talent concentrated in a few giants, squeezing the living space for small and medium-sized startups and making it difficult to cultivate truly native AI leading enterprises. Developing a science and innovation new city in Gwangju, a traditional stronghold of the ruling party, has obvious political overtones of revitalizing the region. However, Gwangju's AI industrial park faces bottlenecks in electricity and water supply. The energy consumption of four super wafer fabs is staggering, and local environmental resistance and policy skepticism from the opposition party will prolong the project implementation cycle. More critically, South Korea's semiconductor advantages are concentrated in the manufacturing of AI memory chips, with obvious shortcomings in AI large models, high-end computing power algorithms, and basic software. Even if several top factories are built, they will still be high-end suppliers in the global AI supply chain, making it difficult to independently build a complete and controllable AI innovation ecosystem. The high investment coupled with long-term order agreements may lead to overcapacity crises if global AI demand cools down or technology roadmaps iterate.
From the perspective of industry competition, the nearly trillion-dollar cooperation agreement between South Korea and the United States could affect the layout of East Asian technological competition. On one hand, South Korea is actively tying itself to the U.S. computing power supply chain, promoting deeper collaboration among the U.S., Japan, and South Korea in semiconductors and AI defense, accelerating the polarized layout of regional high-end chip supply chains. On the other hand, South Korea's excessive tilt towards the United States may also squeeze the space for China-South Korea industrial complementary cooperation. Moreover, internal strategic disagreements within South Korea, the interests of conglomerates, and the need for economic and trade relations with China will prevent it from hastily "taking sides" in AI industry cooperation. Additionally, there is competition between Japan and South Korea in areas such as military industry, semiconductors, and physical AI, making it difficult to form a consensus-driven industrial alliance.
Looking ahead, South Korea must make good use of the profits and tax advantages from the expansion of its HBM production and supply, but it should not be overly optimistic or exaggerate the strategic effects. The "chip-computing power-AI application" ecosystem in California's Silicon Valley is a market-driven entrepreneurial ecology, while the "Korean version of Silicon Valley" is a government-industry planning model. The American-style Silicon Valley model of entrepreneurship, venture capital, and talent ecology cannot be quickly and easily replicated in South Korea. Moreover, the market and capital of the "Korean version of Silicon Valley" are highly dependent on the U.S. market. Once global AI policies adjust or supply chain strategies change, project risks increase, and the future of South Korea's bet-based AI industry breakthrough remains full of uncertainties. (The author is a researcher at the Institute of Northeast Asian Studies, Heilongjiang Provincial Academy of Social Sciences, and an expert at the China Northeast Revitalization Research Institute.)
