Baek Kun-hoon: "Three Years Are the Golden Time for Physical AI Leadership... AI Data Centers Will Serve as the Heart" (Comprehensive)

"Over 1,000 Trillion Won to Be Invested in AI Data Centers by 2035"

Deputy Prime Minister and Minister of Science and ICT Baekgang Hoon is announcing policies at the National Report on the Three Mega Projects held at the Blue House on the 29th, presided over by President Lee Jae-myung. June 29, 2026. Photo by Blue House Press Photographers Team, Yonhap News Agency

Baek Kun-hoon, Deputy Prime Minister and Minister of Science and ICT, announced on June 29 that the government will intensively foster the physical artificial intelligence (AI) sector as a national strategy, aiming to become the world’s number one in this field. He also unveiled plans to significantly boost the competitiveness of the AI industry by promoting over 1,000 trillion won in investments, including the construction of an additional 10 gigawatts (GW) of AI data centers by 2035.

During the “Korea Grand Leap: Three Major Mega Projects National Report Meeting” held at the Blue House that day, Deputy Prime Minister Baek stated, “The next three years are a golden time to become the number one in physical AI,” adding, “The government will designate physical AI as a national strategic industry and lead its development.”

Deputy Prime Minister Baek emphasized that physical AI is distinct from traditional robots. He explained, “While conventional robots are passive, rule-based tools guided by humans, physical AI can recognize situations and predict decisions like humans, then act accordingly. Due to this autonomy, we are now facing a period of major transformation in both industrial sites and everyday life.”

"Korea Has Optimal Conditions to Lead Physical AI"

He assessed that Korea possesses the optimal conditions to lead physical AI. Deputy Prime Minister Baek stressed, “Korea has a strong industrial infrastructure based on manufacturing and world-class AI capabilities, and companies ranked first and second in the global semiconductor industry are located here.”

He cited securing data as a key strategy. “While generative AI is backed by data equivalent to 100,000 years, physical AI currently only has around 10,000 hours of data, which is severely insufficient,” he explained. “To develop today’s physical AI into a large language model (LLM) of the current scale, it could take 100,000 years.” He continued, “It is important to secure on-site data while simultaneously building virtual simulation environments to generate synthetic data.”

In particular, the plan is to build, within three years, a general-purpose physical AI foundation model based on a “world model” that can understand the real world and predict actions once the data infrastructure is in place. Based on this, the government will develop specialized models for each sector and apply them in the field, while also pursuing the localization of the entire physical AI full stack, including robots, general-purpose physical AI models, world models, and network security. Deputy Prime Minister Baek said, “We will support pilot projects in various areas such as agriculture, manufacturing, and safety care, and actively back efforts to make physical AI platforms a major export industry.”

Paik Kyung-hoon, Deputy Prime Minister and Minister of Science and ICT, is announcing policies at the National Megaprojects Report Meeting presided over by President Lee Jae-myung at the Blue House on June 29, 2026. Photo by Blue House Press Photographers, Yonhap News Agency

Additionally, the government unveiled a blueprint to make Korea an irreplaceable powerhouse by making large-scale investments in building AI data centers. Plans include constructing an additional 10GW of AI data centers by 2035, driving investments exceeding 1,000 trillion won. By building a total of 18.4GW of AI data centers, the government aims to significantly enhance the competitiveness of the AI industry.

Deputy Prime Minister Baek stated, “AI data centers will serve as the beating heart that powers artificial intelligence,” adding, “We will invest 550 trillion won in AI data centers with a capacity of 8.4GW in Korea by 2029.”

He continued, “We will move beyond concentration in the Seoul metropolitan area and build AI data centers across various regions to promote local revitalization. By 2035, we plan to add 10GW of AI data centers, leading to a total of 18.4GW and investments exceeding 1,000 trillion won in Korea.”

"Localization of Each Component in AI Data Centers Is Crucial"

He further emphasized, “Localization of each component and solution in AI data centers is crucial. We must apply AI to all solutions and advance as well as scale up equipment for artificial intelligence data centers (AIDC).”

Deputy Prime Minister Baek also mentioned that packaging all facility equipment is an important task. He said, “The government will build a cluster ecosystem, establish a large-scale test lab, and provide active support through tax credits for workforce training and a national growth fund. Through the AI Data Center Alliance, we will actively foster cooperation between solution providers and users.”

He concluded, “Through AI for Everyone, we want to ensure every citizen has access to AI and can use it continuously without cost burden, making Korea the fastest country in the world to become a basic AI society. The key lies in AI data centers. Let us all work together to make Korea an irreplaceable nation by establishing AI data centers as a national strategic industry.”

This content was produced with the assistance of AI translation services.