The South Korean government has announced an ambition to develop a world-leading sovereign AI model, part of a major AI investment package intended to accelerate the country’s domestic AI sector.

Lee Jae Myung, the president of South Korea, confirmed in his 2 November budget speech that his government will spend 4.7 trillion won ($3.49 billion) to develop a sovereign AI model with the “world’s highest performance”.

Sovereign AI has emerged as a growing area of focus for governments working to provide AI functionality for critical national infrastructure and defence without reliance on companies based outside their borders.

Notable sovereign AI models include the French developer Mistral’s Large 4 and German model maker Aleph Alpha’s Kolibri. The UK government has committed at least £560 million to its Sovereign AI Fund, including a further £60 million announced ahead of last week’s budget.

Alongside the sovereign AI commitment, Lee committed to spending $15.86 billion on AI in 2027, including domestic AI development and the rapid buildout of chip manufacturing plants and AI data centres.

“We will invest 21.3 trillion won, nearly twice this year's amount, in AI and the three megaprojects of semiconductors, physical AI and AI data centres,” Lee said.

Lee previously announced the spending in August, with the aim of doubling down on the growing success of the South Korean AI sector.

This is currently dominated by Samsung Electronics and SK Hynix, respectively the world’s fourth and sixth largest semiconductor manufacturers, which have become critical suppliers of the hardware necessary for AI data centres and are generating increasingly large receipts for the South Korean government.

In October, Samsung Electronics reported a third quarter operating profit of 107.4 trillion won ($79.98 billion), a 787 per cent year on year increase. SK Hynix reported an operating profit of 83.3 trillion won ($62.04 billion) over the same period.

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