South Korea targets 'world's highest performance' sovereign AI model in record new budget - CNBC

South Korean President Lee Jae Myung unveiled the country's largest ever budget on Monday, 2 November 2026. Total 2027 spending rises 12.8% to 820.9 trillion won. Within that figure, 21.3 trillion won is allocated to semiconductors, physical AI and AI data centres, nearly double the 2026 level. A separate 4.7 trillion won is earmarked for developing a sovereign AI model.

Lee described the sovereign model as having the "world's highest performance," according to CNBC. The phrase is quoted in the outlet's report on the budget. The 4.7 trillion won is dedicated specifically to the sovereign model and sits outside the 21.3 trillion won.

The budget is the largest in South Korea's history, and the 12.8% increase applies to total 2027 spending rather than to the AI allocations alone. CNBC frames the allocations as part of a national push into AI infrastructure and domestic model development, with the semiconductor, physical AI and data centre figures rising from the 2026 level. South Korea's 2027 plans therefore combine a general spending increase with two distinct AI commitments: the 21.3 trillion won allocation for semiconductors, physical AI and data centres, and the 4.7 trillion won programme for a sovereign model. Both allocations fall under the 820.9 trillion won total for 2027.