South Korea Plans 4.7 Trillion Won Frontier AI Program for 2027
The government plans to separate frontier-model development from industrial AI deployment, opening a new funding competition while continuing its existing foundation-model initiative.
South Korea plans to reorganize its national artificial intelligence strategy in 2027 by separating the development of frontier models from efforts to deploy Korean AI systems across industry. The proposed frontier-model program would be backed by 4.7 trillion won, or about $3.49 billion, in government investment.
The Ministry of Science and ICT intends to open a new competition for the frontier funding rather than automatically extending support to the two teams that survive the current selection process for homegrown foundation models. The new contest is expected to be open to additional companies, including startups with strong technology and specialist talent.
Second Vice Minister of Science and ICT Ryu Je-myung said the government wants to raise the technological ambition of its model-development work while creating a separate track for practical adoption. He also rejected suggestions that the restructuring would end the existing independent foundation-model initiative, known in Korean as Dokpamo.
The current competition among teams led by LG AI Research, SK Telecom and Upstage will continue under its existing timetable. Two finalists are due to be selected after the third-stage evaluation. The ministry is considering incentives that would recognize the resources those finalists have already committed, while seeking to avoid measures that could distort the allocation of public funding in the next competition.
The 4.7 trillion won allocation is included in the government’s proposed 2027 budget as equity investment for the development of a top-tier domestic model. Private capital would be expected to supplement the public funding, although the investment structure has not yet been settled. Options under review include a consortium or a special-purpose company involving large corporations, startups and other investors. The budget proposal remains subject to approval by the National Assembly.
Ryu said the scale of current computing support, equivalent to roughly 1,000 high-end graphics processing units for each remaining team, would not be enough to compete at the frontier of AI development. The planned redesign therefore marks an attempt to concentrate much larger resources on advanced model research while preserving a distinct route for putting Korean models to work in businesses and public services.
The two-track approach reflects the government’s effort to balance technological sovereignty with commercial use. Its success will depend on the final budget, the rules for selecting participants and the way public and private capital are combined.