SK Group and Amazon Web Services to Invest $5 Billion in South Korea's Largest AI Data Centre

South Korea's Ambitious AI Infrastructure Project

South Korea is set to become home to its largest artificial intelligence (AI) data centre, thanks to a significant investment from SK Group and Amazon Web Services (AWS). The Science Ministry announced that SK Group will invest approximately 7 trillion won ($5.11 billion), with AWS contributing $4 billion of that sum, to construct the facility in the southern city of Ulsan 1

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Project Timeline and Specifications

The groundbreaking for this monumental project is scheduled for September, with full operational capacity expected by 2029. Initially, the data centre will boast a capacity of 100 megawatts, making it the largest of its kind in the country 1

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. However, SK Group Chairman Chey Tae-won has even more ambitious plans for the future.

Future Expansion and Global Aspirations

During a meeting attended by President Lee Jae Myung and various tech CEOs, Chairman Chey Tae-won revealed his vision to expand the data centre's capacity to one gigawatt. This expansion aims to transform the facility into a global hub capable of handling domestic AI demand 1

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. This move underscores South Korea's commitment to positioning itself at the forefront of AI technology and infrastructure.

Government Support and Economic Impact

President Lee Jae Myung expressed his support for the project, stating, "It may set a good example that South Korea's high-tech industry is possible not only in the metropolitan area but also in the provinces" 1

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. This sentiment highlights the government's interest in promoting technological development beyond the traditional tech hubs.

Market Response and Stock Rally

The announcement of this massive investment has had a significant impact on South Korea's financial markets. AI-related stocks experienced a notable rally, driven by policy optimism. SK Hynix saw a rise of over 3%, while Kakao surged by 11%, and LG CNS gained 9% 1

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. This positive market response led the benchmark KOSPI to surpass the key milestone of 3,000 points for the first time in 3.5 years, reflecting investor confidence in South Korea's AI initiatives.

Strategic Importance of AI for South Korea

Chairman Chey Tae-won emphasized the crucial role of artificial intelligence in South Korea's future growth 1

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. This investment in AI infrastructure aligns with the country's broader strategy to maintain its competitive edge in the global technology landscape and foster innovation across various sectors of the economy.

Collaboration between SK Group and Amazon Web Services

The partnership between SK Group, a major South Korean conglomerate, and Amazon Web Services, a leading global cloud services provider, represents a significant collaboration in the tech industry. This joint venture combines SK Group's local expertise and resources with AWS's global reach and cloud computing capabilities 1

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