"From Head to Toe with Domestic Technology"... Government to Invest 2.3 Trillion Won in Humanoids over Four Years

From 45% to 80% Localization to Counter U.S. Capital and China’s Scale
Early Mass Production Driven by Partnerships with Top 10 Demand Companies and Government Procurement

The government will invest a total of KRW 2.3 trillion in fiscal resources over the next four years to foster the humanoid ecosystem. The aim is to achieve "full-stack localization" of humanoids, from head to toe—endowing artificial intelligence with a physical body and ensuring it is produced entirely with domestic technology. This policy mobilization is driven by a sense of crisis: should dependency on foreign platforms and critical components persist, the domestic humanoid market risks being relegated to a subcontractor base. Therefore, the government is focusing all its policy capabilities on securing technological sovereignty.

Hongkeun Park, Minister of the Ministry of Planning and Budget, is giving a welcome speech at the "2nd Fiscal Management Strategy Council" held on the morning of August 27 at the large conference room of the Korea Deposit Insurance Corporation in Jung-gu, Seoul. Ministry of Planning and Budget.

On August 27, at the Korea Deposit Insurance Corporation in Seoul, the Ministry of Planning and Budget, presided over by Minister Hongkeun Park, convened the 2nd Fiscal Management Strategy Council. The meeting discussed the “Fiscal Investment Plan for Fostering the Humanoid Ecosystem” and the “Demonstration Strategy for Physical AI in Eight Core Areas.” Minister Park stated, “The global AI market is being restructured around physical AI and humanoids,” emphasizing that “rapid and bold inter-ministerial action is required to foster this as the next growth engine of Korea’s economy.” Humanoids refer to robots with arms and legs like people, while physical AI means machines that perceive, judge, and act within the real world.

The government will begin with KRW 600 billion next year and invest a total of KRW 2.3 trillion by 2030 to cultivate the humanoid ecosystem. Including matched private investment, the total will reach KRW 2.7 trillion. The goal is to raise the localization rate of key components from the current 45% to 80% by 2030. The urgency for localization is driven both by the United States dominating universal platforms through big tech and China establishing mass production via massive national subsidies. Without proprietary technology, domestic sites could devolve into testing grounds and subcontractor bases for foreign tech. The global humanoid market is expected to surge from USD 1.5 billion in 2025 to USD 38 billion by 2035.

First, the government will launch new R&D programs for three core vulnerable components—actuators (joints), robotic hands, and sensors—that account for a major share of robot production costs. In addition, development will cover low-power, high-performance AI semiconductors as well as all-solid-state batteries dedicated to humanoids. To prevent technological dependency, Korea’s own “independent humanoid operating system (OS)” connecting the robot brain, body, and semiconductors will be localized by 2031. The plan also includes constructing an “integrated, pan-ministerial data library” combining manufacturing and physical AI data previously scattered across government agencies. By 2030, the government will train 20,000 convergent professionals proficient in AI, robotics, and manufacturing systems.

The government plans to position robust domestic manufacturing sectors—such as shipbuilding, autos, and display—as hubs for development. According to the International Federation of Robotics (IFR 2024), Korea leads the world in robot density, with 1,220 robots per 10,000 workers, and possesses complete semiconductor and battery value chains, creating ample testbeds for robots. Major industrial buyers such as Samsung Display, CJ Logistics, LG Electronics, and SK Energy will partner with robot manufacturers including Rainbow Robotics, Robotis, and Arobot, to develop humanoids specialized for various sectors. In order to generate initial demand, the government will purchase a total of 5,000 domestically produced robots—including 1,080 humanoids equipped with Korean components and software—by 2030, distributing them to research institutes and universities.

Additionally, the government will demonstrate physical AI in eight core sectors—autonomous manufacturing, small-scale manufacturing, agriculture, construction, logistics, port operations, care/caregiving, and defense—by allocating KRW 2.8 trillion by 2030 (KRW 700 billion for 2027). Over 500 on-site demonstrations will take place next year. These include: an AI agricultural equipment sharing center and the rollout of agriculture robots, five major function test beds at construction sites, integrated unmanned equipment verification for cargo handling and transport in ports, deployment of care robots in vulnerable areas, unmanned vehicles for ammunition transport in army artillery units, and 24-hour unmanned surveillance systems. Furthermore, by next year, the government plans to develop 118 standardized models for processes previously deemed impossible to automate—such as organizing wrinkled clothing, gently packaging bread, and sorting irregularly shaped parcels.

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