"Civil servants from many countries overseas often ask what the secret is behind Korea's unrivaled achievements in information technology (IT). Looking even through National Assembly transcripts, there were countless constraints and voices of concern during the 1980s localization of TDX (electronic switching systems) and the 1990s first commercialization of CDMA (code division multiple access). In the midst of that, policy decisions made after long deliberation were the starting point that made Korea an IT powerhouse."
As the new administration fully activated a pan-government system to push an artificial intelligence (AI) strategy, Vice Minister Ryu Je-myeong of the Ministry of Science and ICT opened his lecture at the "93rd breakfast roundtable" hosted by the Northeast Asia Community ICT Forum (Chairperson Seok Ho-ik) on the 19th floor of the Korea Press Center on the 18th with these remarks.
The Northeast Asia Community ICT Forum's monthly breakfast roundtable regularly draws not only leaders of Korea's IT industry but also seniors who helped craft national ICT policies. In attendance that day were former Deputy Prime Minister and Minister Oh Myung, former Vice Minister Kim Chang-gon of the Ministry of Information and Communication, former TU Media President Seo Young-gil, and former Korea Post head Kang Seong-ju (invited professor at Sejong University).
Vice Minister Ryu, who lectured on the theme "Direction of the new government's AI policy," looked back on past moments of policy determination because of the many challenging situations Korea faces today.
According to Tortoise Media in 2024, Korea's AI capability stands at about 32% of the U.S. capacity. China's capability, revealed by the "DeepSeek shock," is also threatening. MacroPolo, the think tank of the Paulson Institute in the United States, said in its Global AI Talent Tracker 2.0 report that China has become the country producing the most top researchers in AI worldwide (2019: 19% → 2022: 47%).
In the lecture, Vice Minister Ryu repeatedly stressed the new administration's will to secure technology sovereignty and its practicality-focused strategy. He said, "We will break away from dependence on foreign technology, secure technology sovereignty, and pursue AX (an AI-driven grand transformation) across industry, the public sector, and regions so that people can feel tangible improvements in quality of life." The new government's AI policy direction is summarized here, centered on Vice Minister Ryu's presentation.
"AI big three... foundation model competitiveness is a must"
The Lee Jae-myung administration announced 123 national policy tasks to be pursued as priorities over the next five years. Along with constitutional revision for two consecutive four-year presidential terms and the transfer of wartime operational control, achieving an "AI big three" status was included as a core task.
Vice Minister Ryu said, "Currently, Korea is in the third-place group alongside Singapore, the United Kingdom, and France, but it is a distant third from the United States and China. That cannot be called achieving the goal. We must rise to become a top three on par with the two AI leaders."
Some question whether the government's goal is realistically achievable.
On this, Vice Minister Ryu emphasized, "Above all, AI affects defense, security, diplomacy, and more across the board," adding, "Because it is directly tied to national survival, it is very important to have autonomy and control over core technologies."
However, Vice Minister Ryu added, "Supporting the growth of Korea's own AI ecosystem does not mean excluding cooperation with global corporations or proceeding by regulating global corporations," and "OpenAI recently opened a Korea office and is expanding collaborations with domestic corporations, and I believe Korea's AI industry can develop along multiple tracks."
"Secure 200,000 GPUs within five years"
The government believes Korea's AI potential is sufficient. Based on the past five years (2020–2024), Professor Hwang Seong-ju (11th) and Professor Shin Jin-woo (15th) ranked among the world's top 25 researchers in machine learning.
In Jul., LG AI Research's "EXAONE 4.0" (11th) and Upstage's "Solar Pro 2" (14th) ranked among the world's top LLMs (large language models). Korea's ecosystem spanning AI semiconductors, AI foundation models, and AI specialized services is also a strength.
The problem is securing "GPUs." Today's AI models based on transformer architectures derive answers from massive computation. A "scaling law" applies, where more GPUs mean better performance.
Vice Minister Ryu said, "We face an absolute shortage of GPUs to build an AI highway," adding, "We will inject state finances and work to secure 200,000 units within five years."
The government is also reviving a project to build a national AI computing center in which the private sector contributes 200 billion won and holds 49% equity in a special purpose company (SPC). After two failed bids, the government is adjusting conditions, and participation by Samsung SDS and others is seen as likely.
Vice Minister Ryu said, "When China Telecom secured 10,000 GPUs, some viewed it as overinvestment, but after the DeepSeek shock in Jan., demand for GPUs surged among Chinese startups and researchers, and they were almost 100% used up," adding, "As inference services go into full swing, GPU demand will grow further."
Korea's current GPU holdings are estimated at about 20,000 units. U.S. companies Meta and xAI are said to hold about 350,000 and 200,000 units, respectively.
"Fierce U.S.-China competition... focus on a third space of opportunity"
In fact, securing GPUs is difficult enough, and the diplomatic burden from U.S.-China strategic competition is also considerable. In Jul., the United States announced an AI action plan and is pushing an "AI full-stack" strategy urging major countries to use U.S.-made AI models, solutions, and semiconductors across the board.
Vice Minister Ryu said, "On 4th, at the first Asia-Pacific Economic Cooperation (APEC) digital and AI ministers' meeting in Songdo, Incheon, Michael Kratsios, the director of the White House Office of Science and Technology Policy, attended and drew attention," adding, "He emphasized that he is personally spearheading the use of America's AI full stack and offered several policy implications for us."
Vice Minister Ryu also said it is worth noting that China, which showed significant AI power with "DeepSeek," is further advancing its AI policy. In Aug., China's "AI Plus (AI+) Action Plan Deepening Implementation Guidelines" laid out detailed strategies to promote six major AI applications (science, industry, consumption, livelihood, society, and global) and to secure eight foundational capabilities (models, data, computing, open source, talent, safety, and more).
However, Vice Minister Ryu said, "It is worth paying attention to the opening of a third diplomatic space of opportunity." The UAE, Saudi Arabia, and some Southeast Asian countries are seeking Korean corporations as it is difficult for them to depend solely on either the United States or China.
"Give us people-centered AX transformation ideas that the public can feel"
Vice Minister Ryu emphasized, "The final emphasis of the national AI policy is on AX (an AI-driven grand transformation) that enhances quality of life in ways people can feel by building AI capability."
For example, more important than the title of "AI big three" is breaking through structural challenges facing Korean society—such as low birthrate and aging, and the climate crisis, including preventing lonely deaths—and delivering tangible effectiveness for people in healthcare, welfare, and education.
Vice Minister Ryu said, "Next year's AI budget is about three times this year's at 10 trillion won, and most of it is related to improving people's quality of life," urging, "Please bring many ideas so that each sector can produce results through an AX transformation."
After the lecture, various audience questions followed.
An official from an IT association asked, "Korea became an IT powerhouse by rapidly developing applications; in the AI era as well, shouldn't we focus on developing specialized services such as vertical AI and agentic AI?"
In response, Vice Minister Ryu added, "In the AI era, various specialized services will find it hard to be competitive without a deep understanding of the foundation model," and "We must also consider comprehensively that open source such as 'LLaMA' can suddenly become closed."
There was also a view from the audience that "to gain an edge against the United States and China, Korea, as a manufacturing powerhouse, should pursue an AI strategy based on its strengths. Physical AI is important."
Vice Minister Ryu explained, "Our government names 'physical AI' as one of the strategies to secure leap-ahead AI leadership technologies that can lead global AI," adding, "More than 1 trillion won in budget investment centered on Jeonju and Changwon has been finalized. You can regard physical AI as one of the important wheels of the new government's AI policy."
Meanwhile, the government is speeding up organizational restructuring to leap to "AI G3." The National AI Strategy Committee, launched on 8th, completed the formation of subcommittees with 10 Ministers from government ministries and 34 civilian members participating.
The government is also pushing to elevate the Ministry of Science and ICT to a deputy prime minister-level ministry through a Government Organization Act revision. The head of the National AI Strategy Committee support team will be an official at the ministry's director-general level (Grade 1). An AI Policy Office will be newly established within the ministry to handle overall coordination.