Government aims for AI leadership with funding boost

The Lee Jae-myung administration has outlined an economic growth plan that aims to raise the potential growth rate to 3 percent during its term. Although domestic demand stimulation through consumption coupons is expected to keep this year’s growth near zero, the government plans to drive real growth by focusing support on AI transformation and ultra-innovation initiatives. To support this effort, the R&D budget for next year, including AI-related spending, will be doubled to a record 35 trillion won.

Aiming to boost potential growth, the government announced plans to achieve technology-led growth by mobilizing the nation’s capabilities. It has identified 15 AI transformation projects, including robotics, automobiles, and shipbuilding, and 15 ultra-innovation economic initiatives covering advanced materials, components, climate, energy, and future readiness, which will receive focused support through fiscal, tax, and financial measures. To this end, a 100 trillion won public-private National Growth Fund will be created.

The government has more than doubled next year’s AI-related budget to 2.3 trillion won, up 106.1 percent from 1.1 trillion won last year, aiming to become a top-three AI power. The overall R&D budget for next year will total 35.3 trillion won, an increase of more than 20 percent over cuts made under the previous Yoon Suk-yeol administration.

President Lee attended the first meeting of the National Science and Technology Advisory Council at the presidential office in Yongsan, Seoul, and said, “The next two to three years are a golden time for AI. If we move even half a step ahead during this period, we will become leaders with limitless opportunities, but if we fall behind, we will remain perpetual followers.”

However, some critics note that the government’s first economic growth strategy focuses on investment in innovative industries while giving less attention to structural reforms, including addressing demographic challenges. “The focus on technology investment is the right direction, but without regulatory and labor market reforms, there are limits,” said Kim Sang-bong, a professor of economics at Hansung University.


Ae-Jin Ju jaj@donga.com