South Korea plans to develop a new semiconductor manufacturing hub in the southwestern region of the country through an 800 trillion won ($517.9 billion) corporate investment, which will establish four memory chip production facilities, Industry Minister Kim Jung-kwan announced on Monday.

Kim disclosed the investment plan, which aims to transform the Gwangju and Jeolla regions into the country’s second-largest semiconductor cluster alongside the existing hub in the Seoul metropolitan area, during a national investment briefing chaired by President Lee Jae Myung at Cheong Wa Dae.

“To meet the rising demand for semiconductors, relying solely on a single production base in the Seoul metropolitan area is no longer sufficient,” Kim said, noting that constraints on power and water resources under current plans limit further expansion.

The semiconductor investment is part of the government’s “three mega projects” initiative. This initiative envisions large-scale investments by chip giants such as Samsung Electronics Co. and SK hynix Inc., alongside other companies, in the fields of semiconductors, physical artificial intelligence, and AI data centers.

To meet the increasing packaging demand as chip production expands, the Chungcheong region will be transformed into an advanced semiconductor packaging hub with an 81 trillion won investment, Kim said. He added that the Daegu and North Gyeongsang regions will be developed as innovation hubs for semiconductor materials, components, and equipment.

Kim also stated that the government will assist companies in accelerating their semiconductor investments by bringing forward the construction schedule of the new manufacturing facilities by up to 12 years. Consequently, the construction of the plants will be moved to the mid-2030s instead of the mid-to-late 2040s.

To support this expansion, the government has committed to streamlining permitting and construction processes, as well as investing in critical infrastructure, including the supply of electricity and industrial water.

At the meeting, which was also attended by Samsung Electronics Chairman Lee Jae-yong and SK Group Chairman Chey Tae-won, Kim presented a plan for a 30 trillion won investment by the government and industry over the next 15 years to support the entire semiconductor value chain, from research and development and chip design to testing and manufacturing.

The ambitious industrial roadmap aims to transform the country from a global manufacturing powerhouse into a leading player in the era of artificial intelligence. At the core of the strategy are semiconductors, AI infrastructure, and physical AI.

Regarding the robotics sector, Kim said the government will develop the AI-powered robotics industry to strengthen South Korea’s manufacturing competitiveness amid intensifying global competition.

Kim warned that China has already begun mass-producing humanoid robots through regional manufacturing hubs, emphasizing that South Korea must accelerate the commercialization and mass production of its own humanoid robots.

“We must accelerate the foundation for mass production,” Kim said, adding that the government plans to generate early domestic demand by supplying humanoid robots in the fields of education, defense, and disaster response.

The initiative aims to increase South Korea’s share of the global humanoid robot market to 20% in the long term, up from just 1% last year.

As the third pillar of the strategy, the government announced an ambitious plan to expand the country’s AI data center infrastructure.

In collaboration with SK Group, GS Group, and portal operator Naver, the government plans to invest approximately 550 trillion won by 2029 to construct AI data centers with a total capacity of 8.4 gigawatts (GW). The total investment is expected to exceed 1,000 trillion won by 2035, expanding capacity to 18.4 GW.

To support this initiative, the government has pledged to secure sufficient power and industrial water supplies and to strengthen the energy infrastructure around existing semiconductor clusters.

US-based artificial intelligence startup Anthropic has accused Chinese technology giant Alibaba of using thousands of fake accounts to gain unauthorized access to its proprietary AI model, Claude.

According to reports by Bloomberg, the Financial Times, and Reuters, which cited an official letter sent by the company as well as informed sources, the allegations were formally communicated to US senators and White House officials.

In the letter, Anthropic asserted that activities conducted by operators linked to Alibaba targeted the most valuable capabilities of the Claude model, including its software development functionalities.

The company characterized the incident as the largest attempt to date by a Chinese firm to leverage pioneer US artificial intelligence technologies for its own benefit.

Twenty-nine million suspicious transactions in three months

According to data compiled by Anthropic, approximately 29 million transactions linked to the Claude model were executed through roughly 25,000 fake accounts between April and June.

The company noted that Alibaba and other China-based firms systematically exploit leading US technologies to develop their own chatbots.

In the letter, as reported by Bloomberg, Anthropic officials evaluated the process, stating:

“These attacks, carried out through distillation methods, were executed systematically and on an industrial scale to illegally copy advanced US AI technologies from leading laboratories, bypassing training and research-and-development costs to present them as their own products.”

The Financial Times pointed out that the distillation method is widely used in the technology sector to train cheaper and smaller versions of artificial intelligence models.

However, US officials are concerned that the use of this method by Chinese competitors to develop their own models could carry serious national security implications.

Call to Congress to close loopholes

According to the Financial Times report, Anthropic urged the US Congress to close legal loopholes that allow Chinese AI firms to access advanced US technologies, and to penalize the Chinese companies responsible for these cyber activities.

The company also stated that Alibaba pursued this activity brazenly, even after the White House issued a directive emphasizing the need to prevent intellectual property theft at artificial intelligence firms.

As reported by Reuters, Anthropic emphasized in its letter that it supports the Washington administration’s efforts to combat cyberattacks.

On June 13, Anthropic announced that the US government had mandated blocking access to its most advanced AI models, Fable 5 and Mythos 5, for all foreign users who are not US citizens.

Subsequently, David Sacks, a US investor and co-chair of the President’s Council of Advisors on Science and Technology, explained that the decision was taken following the detection of possibilities that the built-in security mechanisms of the models could be bypassed.

Uncertainty in the global arms market, driven by the United States reassessing its relationships with allies and a broad rearmament drive across many countries, is creating major commercial opportunities for South Korea. According to an analysis published by Politico, Seoul has become the world’s fastest-growing supplier of military equipment.

The report said that large-scale conflicts around the world have created urgent demand for weapons as countries seek both to support allies and strengthen their own defenses against potential future confrontations. At the same time, changes in the US role within the global arms market have opened new opportunities for South Korean manufacturers. Statements and policy decisions by US President Donald Trump regarding NATO have led allies to question Washington’s reliability in times of crisis, increasing uncertainty across the global market. In addition, the diversion of a large share of US weapons supplies to the Middle East because of ongoing conflicts has placed further strain on already overstretched supply chains.

European countries increase purchases from South Korea

Faced with what Politico described as the Trump administration’s more distant approach toward allies, European countries in particular have accelerated arms purchases from South Korea. The publication noted that Seoul’s growing influence as a supplier has been driven largely by major defense contracts signed with Poland.

Following the outbreak of the conflict in Ukraine, several Eastern European capitals, including Warsaw, transferred portions of their military inventories to Kyiv, relying on German support to replenish their arsenals. However, Berlin’s slow pace in replacing allied stockpiles generated frustration across the region.

South Korea emerged as an alternative supplier during this period and became a reliable source of military equipment for Eastern European countries. Poland became Seoul’s largest customer through a $13.7 billion agreement covering the purchase of tanks, rocket launchers, self-propelled howitzers and other military equipment.

“We were originally preparing against North Korea, but now we are ready to provide these solutions to customers around the world,” said Choo Hyung-kim, head of the Security Management Institute, a defense analysis organization affiliated with South Korea’s National Assembly.

Lack of political baggage gives Seoul an advantage

Politico reported that one of the greatest advantages enjoyed by South Korean defense companies is the absence of the “political baggage” associated with major arms exporters such as the United States, China, Russia and Israel.

According to the figures cited, the combined projected revenue of South Korea’s largest defense companies, including Hanwha Group, Hyundai Rotem, LIG Nex1 and Korea Aerospace Industries, is expected to reach approximately $37 billion in 2026. That would represent a fourfold increase from their combined revenues in 2021.

Meanwhile, an official from the office of former South Korean President Yoon Suk-yeol told the Yonhap news agency in 2024 that the scale of any weapons shipments to Ukraine would depend on Russia’s approach to its relationship with North Korea. Seoul later clarified that it had no plans to provide ammunition directly to Ukraine.