Korea to develop humanoid robots, court foreign researchers in sweeping AI investment plan

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Korea to develop humanoid robots, court foreign researchers in sweeping AI investment plan

Published: 22 Aug. 2025, 19:27

Audio report: written by reporters, read by AI

Deputy Prime Minister and Minister of Economy and Finance Koo Yun-cheol announces the 15 leading projects for a national AI transition project during a joint briefing with related ministries at the government complex in Jongno District, central Seoul, on Aug. 22. [NEWS1]

The government will prioritize AI as the top national growth driver for the next five years, committing funding and personnel to reverse the slowing growth caused by demographic challenges.

The economic strategy, announced at a joint meeting of the growth strategy task force and economic ministers on Friday, outlines the policy blueprint for President Lee Jae Myung’s administration.

The government set the vision of becoming one of the world’s top three AI powers, lifting Korea’s potential growth rate to 3 percent and raising national strength into the global top five.

AI-led transformation

The government selected 15 major projects to lead the AI transition. Seven focus on manufacturing strengths — including robotics, automobiles, shipbuilding, home appliances, drones, factories and semiconductors — with the goal of becoming the global leader in “physical AI.”

For example, Korea will develop general-purpose humanoid robots, first applying them in logistics before expanding into manufacturing, construction and services.

In semiconductors, domestic fabless and foundry firms will be tasked with developing on-device AI chips essential for autonomous vehicles, smart appliances, collaborative robots and unmanned aerial vehicles.

To build talent, the government plans to reform education and work force systems under an initiative called “AI as the Korean alphabet,” designed to help all Koreans use AI as naturally as they use hangul.

It will also provide top-tier talent with high salaries and military service exemptions while seeking to recruit 2,000 distinguished and early-career researchers from overseas.

On data, considered essential for the AI era, the government will expand access to public sector datasets and promote the use of anonymized information to minimize privacy risks.

Robots compete at the World Humanoid Robot Games in Beijing on Aug. 17. [AP/YONHAP]

Startup and investment push

The plan also aims to foster 50 unicorns through the “Next Unicorn Project,” supporting deep-tech startups through AI competitions and public-private incubators. To finance this, the Ministry of SMEs and Startups will expand the venture capital market to more than 40 trillion won ($28.8 billion) annually by 2030, more than triple the 2024 level.

Pension funds will create dedicated vehicles for venture investment, while individuals will gain easier access through business development companies, similar to exchange-traded funds. A national growth fund of more than 100 trillion won will backstop the effort.

The government argues that AI is the only viable solution to address falling growth. Korea’s potential growth rate has slipped from more than 3 percent in the 2010s to below 2 percent on Friday and could drop to near zero by 2040.

“The AI era has arrived at the right time, giving our economy a crucial opportunity — and perhaps the last golden time — to rise as a leading nation,” said Deputy Prime Minister and Finance Minister Koo Yun-cheol.

A virtual board equipped with Rebellions’ AI chip is displayed at the Gwacheon National Science Museum in Gyeonggi on Aug. 7. The chip enables data centers to store and manage digital data. [YONHAP]

Beyond AI: 15 “Super-innovation projects”

The 15 flagship projects also include silicon carbide (SiC) power semiconductors, superconductors, next-generation power grids and biohealth. The goal is to improve self-sufficiency in critical technologies and capture global market share.

SiC power chips, which have higher efficiency and lower heat than conventional silicon chips, are expected to be vital for electric vehicles, renewable energy and data centers. The government aims to raise Korea’s technology self-sufficiency rate from 10 to 20 percent and domestic production share from 5 to 10 percent by 2030, with targeted investments in talent, infrastructure and financing.

In energy, the government will accelerate the construction of an “energy expressway” along the west coast, moving up the launch of a high-voltage direct current grid by one year to 2030. The line will connect offshore wind and solar power along the nation's west coast to the greater Seoul area and the rest of the country.

Students line up for breakfast that costs 1,000 won (70 cents) at the student cafeteria of Pukyong National University in Nam District, Busan, on March 4. [YONHAP]

Regional and social measures

The blueprint also emphasizes decentralization from the capital area, prioritizing policies that favor regional growth.

The southeast will specialize in automobiles and shipbuilding, while the southwest will focus on renewable energy and food industries.

A new “K-regional total package” will promote regional tourism, with the special budget for balanced regional growth set to rise from 3.8 trillion won this year to 10 trillion won in 2026.

To support households, the government will expand the 1,000 won breakfast program at universities and broaden energy voucher eligibility for low-income families. A transportation pass will reimburse 20 to 53.3 percent of fares for young people, adults and seniors. Housing measures include rent support for young people.

Financial support for small businesses will be strengthened. Loan refinancing eligibility will expand, while the tax credit dubbed the “Good Landlord” — covering up to 70 percent of rent reductions — will be extended to 2028. Contribution limits for the tax-deductible Yellow Umbrella Mutual Aid Fund will increase from 300 million won quarterly to 1.8 billion won annually.

On regulatory reform, the government will ease excessive criminal penalties on businesses, shifting toward stronger civil and financial accountability while reducing criminal liability. Revisions to Korea’s strict breach-of-duty law will also be considered.

The growth strategy replaces the traditional second-half economic policy package, reflecting the administration’s focus on long-term direction rather than short-term stimulus.

“Finding new vitality in AI is the right direction, given the stagnation in both large and small businesses and changes in global trade,” said Kim Sang-bong, an economics professor at Hansung University. “But there is still skepticism regarding what AI actually means. The government must track progress step by step and ensure the policies deliver real results.”

This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.
BY JANG WON-SEOK, KIM YEON-JOO [[email protected]]