South Korea Boosts AI Budget

South Korea is significantly increasing its budget spending for 2026, with a major focus on artificial intelligence. The government plans to allocate 10.1 trillion won ($7.27 billion) to AI initiatives, more than tripling the 3.3 trillion won assigned in 2025. This investment aims to position South Korea as a global AI leader, striving to be among the top three AI powerhouses alongside the United States and China.

The increased spending is part of a broader strategy to revitalise the economy through technological advancement. The government's 2026 budget proposal includes a record 728 trillion won, marking an 8.1% increase from the previous year. This expansionary fiscal policy is projected to raise the national debt-to-GDP ratio to 51.6%. The AI investment will focus on establishing a foundation for AI transformation across industries and daily life, with 900 billion won dedicated to integrating AI into 300 products.

Beyond AI, the government is also increasing investment in other key areas, including research and development, energy transition, and cultural initiatives. A total of 54 trillion won is allocated for AI transformation and R&D growth by 2026. The government aims to invest approximately 6 trillion won over the next five years in regional innovation hubs to develop and test AI-enabled technologies in sectors like robotics and automotive.