New to this? Read it in simple words
- South Korea’s president wants to spend 21.3 trillion won on AI and chips next year.
- He says that is nearly double this year’s amount.
- The biggest single part, 4.7 trillion won, is for building a top Korean AI model.
- Parliament has until December 2 to pass the budget.
- Physical AI
- AI that controls machines in the real world, such as robots and factory equipment.
- Frontier AI
- The most capable AI models, at the edge of what the technology can do today.
- Won
- South Korea’s money. 21.3 trillion won is about $16 billion.
South Korea’s government first set out its 2027 budget in September. On Monday, Lee Jae Myung presented it to the National Assembly in person and asked lawmakers to pass it on time.
Where the AI money goes
The official text of the speech names several parts of the 21.3 trillion won. A new special account for the chip industry puts 2 trillion won into production, including an earlier start for chip plants near Seoul and a new cluster in the southwest.
Another 500 billion won pays for field trials of physical AI in eight key areas, such as manufacturing, smart factories and defence. A further 2.1 trillion won goes to power, water and industrial sites, so that companies do not miss their chance to invest.
The largest single item is 4.7 trillion won for frontier AI development. Lee said the aim is “world-leading performance for our own AI model, a national strategic asset,” in AFP’s translation.
Items named in Lee’s speech of November 2. The speech names only part of the total.
Public services and defence
The speech also starts an “AI for everyone” programme. It includes public AI agents that tell people which public services they need and help them apply, Lee said.
For defence, Lee said the military would build combined systems of crewed and uncrewed machines, based on AI, robots and drones. AFP reports that the defence budget would grow by about 8%, to 73.3 trillion won.
“We will make bold investments in AI and future growth engines to boost our economy’s growth potential,” Lee said, in AFP’s translation.
What happens next
The whole budget is 820.9 trillion won, up 12.8% on this year. The speech calls it the largest budget and the fastest rise on record.
Lee asked lawmakers to approve the budget by December 2, the legal deadline, the Korea Times and the Korea Herald report. His Democratic Party holds a majority, so the budget is likely to pass, AFP reports.
The main opposition People Power Party criticised the speech, according to the Korea Times.
Sources
Every fact in this story comes from the sources below. Open them to check our work.
- 1Primary source · November 2, 20262027년 예산안 시정연설 (Budget speech on the 2027 budget) Government of South Korea (korea.kr)
- 2Research · November 2, 2026President highlights growth fund as he seeks parliamentary backing for record budget The Korea Times
- 3
- 4
The amounts come from the official text of the speech and match the news reports. “Nearly double” is the government’s own comparison, and no report gave this year’s figure.
South Korea’s president asks for nearly double AI spending. Silicon AI News, November 2, 2026. https://siliconainews.com/stories/south-korea-2027-ai-budget-speech
South Korea’s president asked parliament to pass a record budget that nearly doubles AI spending, though lawmakers must still approve it. How we rate the mood
The mood shows how the news frames the event for the tech and AI world: as an opportunity (6 and above) or as a loss (below 5). It is not our verdict on who is right.