Seoul: The presidential policy chief emphasized on Wednesday the necessity for substantial investment in artificial intelligence (AI) infrastructure, underscoring the importance of such measures to enhance South Korea's growth trajectory in the AI sector.
According to Yonhap News Agency, Kim Yong-beom, the presidential chief of staff for policy, highlighted this imperative during a discussion organized by the Kwanhun Club, a senior journalists' association. The event took place amid a surge in South Korea's stock market, propelled by record profits and stock gains among AI-related chipmakers.
Kim emphasized that if the ongoing semiconductor and AI supercycle signifies the onset of a structural transformation poised to elevate South Korea's growth trajectory and reshape its industrial structure, the nation's response should be proactive and strategic. He stressed the need for new state infrastructure to support this AI-driven evolution, advocating for preemptive and robust investments that could redefine South Korea's industrial landscape.
He pointed out the necessity for vast amounts of electricity and land, as well as the development of a new industrial ecosystem, suggesting that regional areas could offer a fresh industrial landscape with data centers, future electricity networks, and additional infrastructure.
Kim indicated that the capital region currently lacks further capacity for land, electricity, or water, hinting at the possibility of the government establishing another semiconductor cluster in a regional area. Currently, a semiconductor cluster is being constructed in Yongin, south of Seoul, to serve as a pivotal production hub for advanced semiconductor products produced by major companies like Samsung Electronics Co. and SK hynix Inc.
Kim noted that discussions regarding the construction of an additional cluster are nearing completion. Once finalized, the government would seek an opportunity to present the plan to the public.
The policy chief also emphasized the necessity for societal discussions on utilizing excess tax revenues and formulating policies to address social and labor issues in the AI era. He pointed out the importance of equitable distribution of growth benefits, asserting that while AI could enrich a nation, it does not guarantee equal enjoyment of benefits for all citizens.
South Korea's economy is projected to achieve a real growth rate of 3 percent this year compared to the previous year, with the nominal growth rate potentially reaching the 10-percent range, according to Kim. He also highlighted positive economic indicators, including the country's annual per capita national income reaching US$40,000, record-high corporate profits, and stock market rallies.
Nevertheless, Kim expressed concerns over the continued depreciation of the Korean won against the U.S. dollar and instability in the real estate market, identifying these as challenges to be addressed.
Kim cited a recent agreement between Samsung Electronics Co. management and its largest labor union over corporate profits as the world's first instance of such a case, advocating for the institutionalization of corporate-labor negotiations over bonuses. In May, Samsung Electronics' labor union reached a wage agreement that included a substantial bonus package for chip employees, following threats of a general strike amidst soaring earnings from the AI-related semiconductor sector.
Kim suggested the establishment of rules through discussions, noting that while the government is examining France's relevant profit-sharing regulations, there are limited global precedents for corporate-labor negotiations over bonuses.