South Korean President Lee Jae Myung earlierMeeting with leaders of major South Korean companiesFollowing the meeting, industry giants including Samsung, Hyundai Motor Group, and SK Group jointly announced a new large-scale domestic investment plan in South Korea.
This move is clearly intended to balance the $3500 billion in investment committed to the US under the previous US-South Korea trade agreement, thereby alleviating concerns that companies will prioritize the US and crowd out domestic investment.
Samsung invests $3100 billion to expand its Pyeongtaek plant and increase investment in AI data centers.
Of all the commitments, Samsung's is the largest. Samsung announced it will invest 450 trillion won (approximately US$3100 billion) in South Korea over the next five years to expand its domestic operations.
At the heart of this plan is the expansion of a new memory chip production line at the Pyeongtaek manufacturing center to address the surge in global semiconductor demand driven by AI. The line is expected to be operational in 2028.
In addition, Samsung plans to build new AI data centers in South Jeolla Province in the southwest of South Korea and Gumi City in the southeast, in response to the government's policy of narrowing the development gap between the Seoul metropolitan area and other regions.
Hyundai and SK are increasing their investment in AI robotics and R&D.
At the same time, Hyundai Motor Group, South Korea’s largest automaker, has pledged to invest 125 trillion won (about US$863 billion) in South Korea between 2026 and 2030 to expand research and development (R&D) and advance new technologies such as AI, robotics and autonomous driving.
Semiconductor giant SK Group plans to invest at least 128 trillion won (approximately US$883 billion) in South Korea by 2028, also focusing on the AI sector. Other shipbuilders, such as Hanwha Ocean and HD Hyundai, have also announced increased domestic investments.
The US-South Korea trade agreement eliminates uncertainty in exchange for tariff reductions.
At the meeting, South Korean President Lee Jae-myung praised the business community for assisting the government in completing trade negotiations with Washington, but also urged businesses to maintain strong domestic investment. Lee pledged that the government is exploring several policies, including easing regulations, to create a more favorable business environment.
SK Group Chairman Chey Tae-won responded that completing trade negotiations with the United States would help eliminate uncertainty and provide a basis for companies to invest more boldly in the domestic market.
Looking back at the US-South Korea trade agreement finalized last week, South Korea pledged to invest $3500 billion in the US (including $1500 billion in shipbuilding and $2000 billion in other industries) in exchange for the US avoiding the highest tariffs imposed by the Trump administration.
In exchange, the United States agreed to reduce tariffs on South Korean automobiles and auto parts from 25% to 15% and to grant South Korea "no less" than its other competitors on semiconductor tariffs.
