The world’s two largest memory chip companies—Samsung and SK Hynix—plan to invest $518 billion (~800 trillion won) to build four new memory fabrication plants in southwestern South Korea, a region that has historically attracted little semiconductor investment. As of 2026, this move targets the ongoing global memory chip shortage, dubbed 'RAMageddon,' driven by surging AI demand.
The announcement is part of the country’s sweeping national investment plan spanning semiconductors, AI data centers, and physical AI, unveiled at a presidential briefing on Monday with Samsung and SK Hynix chairmen in attendance. The plan breaks down into three main buckets: $518 billion for four new memory fabs in the southwest, plus $52 billion for a high bandwidth memory (HBM) packaging hub in the central region. Additionally, $356 billion (550 trillion won) will be directed toward AI data centers built by Korean tech and energy giants such as SK, GS, and Naver through 2035.
All told, South Korean tech companies have committed to spend over $900 billion on AI and the chip demands it creates. The nation hopes to catapult itself into an even stronger AI power player. Currently, Samsung, SK Hynix, along with U.S. memory chip maker Micron, enjoy record demand from what’s been called RAMageddon—a worldwide shortage of memory chips caused by the AI buildout.
“Semiconductors, physical AI, and AI data centers are the triple axis for South Korea’s next industrial era,” President Jae Myung Lee said in a televised address Monday, calling 2026 the year South Korea must establish itself as an “irreplaceable” industrial power.
Lee noted that existing chip facilities in Yongin and Pyeongtaek—the heart of South Korea’s semiconductor belt just south of Seoul—have “already reached their limits.” He urged companies to accelerate investment in the southwest, aiming to spread AI wealth beyond the capital. “We must secure overwhelming production capacity in advance,” he said.
Yet, Lee pushed back against media reports that the government had pressured companies into these investments. He reportedly said the decisions reflected the companies’ own judgment. “The government’s role is to invest its capabilities so that companies can invest without losses and with better prospects,” he was quoted as saying.
Samsung separately published a press release Monday, announcing plans to invest 2,655 trillion won (~$1.7 trillion) over the next decade, with 425 trillion won earmarked for the Honam region—the southwestern corner of the Korean peninsula. The company cited expected incentives around power, water, workforce, and living conditions as key factors in selecting Gwangju, roughly 300 kilometers south of Seoul, for a new semiconductor fab, alongside an AI data center in Haenam at the southern tip of the peninsula.
This sum is not outlandish compared to U.S. tech giants Alphabet, Amazon, Meta, and Microsoft, who will collectively spend $650 billion on AI infrastructure this year alone, according to Reuters.
Meanwhile, SK Group announced a 2,100 trillion won (~$1.4 trillion) medium-to-long term investment roadmap: 1,100 trillion won to expand semiconductor production capacity and 1,000 trillion won for AI data centers nationwide. SK Hynix, the group’s core semiconductor affiliate, is central to the chip expansion.
via TechCrunch