Government R&D Budget Nears the 40 Trillion Won Era... 200 Trillion Won to Be Invested by 2030

[Financial News] The government will allocate 39.5 trillion won to research and development (R&D) next year. It plans to invest 200 trillion won over the next five years through 2030. The goal is to develop a world-leading artificial intelligence (AI) model and build the first commercial small modular reactor (SMR).
According to the 2027 budget bill approved by the State Council of South Korea on the 1st, the Ministry of Science and ICT has set the government R&D budget at 39.5 trillion won. That is up 11.2%, or 4 trillion won, from this year. Of that amount, the key R&D budget allocated and adjusted by the Vice-Ministerial-level Office for Science and Technology Innovation will rise to 33.8 trillion won, up 11.5%, or 3.5 trillion won, from 2026.
The growth rate of the government R&D budget will remain in double digits in 2027, following a 19.9% increase in 2026. This is far above the 7.2% average annual growth rate of government R&D spending over the past 20 years, reflecting the government's determination to expand R&D investment and make science and technology a key engine of future growth.
The 2027 government R&D budget focuses on four priorities: the largest-ever investment in new projects to plant the seeds of growth; full-scale support for three mega-projects and seven major SEED initiatives based on national strategic technologies; stronger, more detailed support so all citizens can share in the fruits of growth; and a 'one-team' approach to R&D budget allocation and planning involving all government ministries and the private sector.
Park In-gyu, head of the Science and Technology Innovation Office at the Ministry of Science and ICT, said, "2027 is the golden time to deliver results within the next four years." He added, "Under the principle of bold R&D investment, we have focused on four areas to plant the seeds of South Korea's great leap forward through science and technology and to drive technology-led growth that all citizens can feel."
First, the government will invest a record 330 billion won in new projects. For large-scale R&D projects with total budgets of 100 billion won or more, the review period has been sharply shortened from about two years to three months compared with the existing preliminary feasibility study, allowing timely investment in needed technologies.
It will also significantly expand investment in the 10 NEXT strategic technology areas — AI, next-generation security and network, semiconductors and display, advanced robots and mobility, next-generation batteries, future energy and atomic energy, innovative and future materials, advanced biotechnology, aerospace and ocean, and quantum — from 11 trillion won to 13.8 trillion won in order to secure world-leading and first-ever technologies and create future growth engines. Of that amount, 5.8 trillion won will go to three mega-projects at the core of the nation's great leap forward, including semiconductors, physical AI and AI data centers (AIDC), while 3.7 trillion won will be directed to seven major SEED areas that are expected to grow into future industries, including SMR, renewable energy, nuclear fusion, quantum, aerospace, advanced biotechnology and advanced supply chains.
In particular, AI R&D will receive 4.1 trillion won, an increase of 1.7 trillion won, or about 70%, from this year. The government plans to build the domestic physical AI ecosystem by developing world models for large-scale synthetic data generation and general-purpose robot foundation models, with the goal of becoming the No. 1 player in physical AI by 2030. It will also launch large-scale R&D to enter the global value chain and overcome the current limitations of AIDC in order to foster it as a national power industry.
In addition, 130 billion won will be invested in semiconductors and displays, 280 billion won in next-generation energy, and 220 billion won in advanced biotechnology. The government will also introduce and support investment-type R&D that follows a cycle of investment, recovery and reinvestment. It plans to strengthen regionally autonomous R&D as well as defense and K-Defense Industry R&D to support innovation and economic vitality in the private sector and regions. Basic research will receive 360 billion won, and 480 billion won will be provided to government-funded research institutes to strengthen stable personnel funding as the project-based system (PBS) is abolished.
As a result, the government plans to invest more than 200 trillion won in government R&D over the next five years from this year through 2030 for the first time ever. The plan aims to develop a world-leading AI model and secure world-class physical AI capabilities. It also sets a goal of maintaining the world's No. 1 position in semiconductor manufacturing and building the first commercial SMR by 2035.
[email protected] Yeon Ji-an Reporter