Korea and Japan National AI Policy and Sovereign AI — 2026-10-22
South Korea faces a stark reality check as data reveals Nvidia accounted for 99.98% of public AI chip purchases, highlighting the gap between sovereign ambitions and infrastructure reality. Meanwhile, industry groups are urging the government to accelerate physical AI support to keep pace with China and Japan, as the US and Europe secure massive Nvidia investments for their own sovereign AI initiatives.
Korea and Japan National AI Policy and Sovereign AI — 2026-10-22
Nvidia dominates Korean public AI chip market with 99.98% share
New data released on October 22 shows that Nvidia accounted for 99.98% of all AI accelerator spending by Korean public institutions, with only one of 191 units being domestic. This statistic underscores the challenge facing South Korea’s "Sovereign AI" strategy, which aims to reduce dependence on foreign hardware despite significant government investment in local NPU development and the National AI Computing Center.
Korean business groups urge faster support for physical AI
The Federation of Korean Industries submitted 119 policy proposals on October 22, arguing that Korea is lagging behind China and Japan in supporting "physical AI" (AI integrated with robotics and manufacturing). The group is calling for specific legislation and changes to labor rules to facilitate the deployment of AI in industrial settings, aiming to protect Korea’s manufacturing competitiveness against regional rivals.
Nvidia CEO pushes sovereign AI in Europe and Asia
Nvidia CEO Jensen Huang is actively urging nations to build their own sovereign AI infrastructure, pledging $2 billion for Europe and $250 million for UK AI safety research in recent days. This global tour reinforces the trend of nations seeking independent AI capabilities, a concept central to both South Korea’s and Japan’s national strategies, even as the hardware supply remains heavily concentrated.
Nvidia secures dedicated Korean chip packaging lines
Nvidia signed a co-investment deal with Samsung Electro-Mechanics on October 22 to establish exclusive FC-BGA substrate lines in Sejong and Busan. This move is designed to lock in supply chain capacity for next-generation AI accelerators, addressing industry concerns about lead times stretching from 12 to 48 weeks and highlighting the deepening integration of Korean manufacturing into the global AI hardware ecosystem.
Local view
Local media outlets are focusing on the tension between ambitious sovereign AI goals and the practical dominance of US hardware. Seoul Economic Daily highlighted the 99.98% Nvidia dependence as a critical vulnerability in Korea’s push for technological sovereignty. Meanwhile, Money Today reported on NIA officials describing AI data centers not just as IT facilities but as "national strategic factories" for producing intelligence tokens, emphasizing the need for advanced power systems like SMRs to support this infrastructure.
Context & numbers
- GPU Procurement: South Korea has secured 19,000 GPUs this year to accelerate AI infrastructure, with plans to expand supply to startups and research institutions.
- Budget Allocation: The 2026 budget proposal includes 10.1 trillion won for AI, more than triple the 3.3 trillion won in 2025, funding the National AI Computing Center and sovereign model projects.
- Infrastructure Goals: Korea plans for 18.4 GW of AI data centers by 2035, with a 260,000 GPU supply deal in the works, though power grid stability remains a primary bottleneck.
- Global Market: The global AI accelerator chips market is projected to grow at a 23.5% CAGR from 2026 to 2034, driven by generative AI and edge computing demand.
On the radar
- AI Basic Act Implementation: The Korean Ministry of Science and ICT is finalizing details for the AI Basic Act, which aims to balance promotion with regulation, though critics argue the focus remains heavily on industrial growth over strict governance.
- Japan’s GENIAC Phase 4: Japan’s METI and NEDO continue to support domestic generative AI development through the GENIAC program, with recent kickoffs for Phase 4 projects focusing on specialized industrial applications and robotics.
- US Data Center Delays: Reports indicate at least 47 major US data center projects faced delays this year due to funding, power, and community opposition, which may impact global hardware demand and supply chain dynamics for Korean suppliers.
This content was collected, curated, and summarized entirely by AI — including how and what to gather. It may contain inaccuracies. Crew does not guarantee the accuracy of any information presented here. Always verify facts on your own before acting on them. Crew assumes no legal liability for any consequences arising from reliance on this content.
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