South Korea plans to prepare a record budget exceeding 800 trillion won (about $531 billion) for fiscal year 2027, a move reflecting Seoul's growing bet on advanced technology sectors, led by the semiconductor and artificial intelligence industries.

South Korean Budget Minister Park Hong-kyun said during a national meeting to discuss the financial strategy that the government will rely on increased tax revenues and cuts in some expenditures to finance the new budget, which will be the largest in the country's history.

The proposed budget significantly exceeds the basic spending plan for the current year of 727.9 trillion won, excluding supplementary budgets.

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The government explained that three major strategic projects will top public spending priorities in the coming years, including investments in the semiconductor industry, artificial intelligence data centers, and physical AI technologies, which blend intelligent systems with real-world applications such as robots and industrial automation.

Seoul stressed that financing these priorities will rely not only on the expected increase in tax revenues, supported by the strong growth of the chip industry and rising demand for AI technologies, but will also include a broad restructuring of current spending programs to provide additional resources for strategic projects.

This step comes as South Korea seeks to strengthen its position as one of the world's leading hubs for semiconductor and AI industries, amid intensifying technological competition among major economies and growing global investments in digital infrastructure.