The South Korean sovereign wealth fund enters the tech competition, targeting strategic industries such as AI and Siasun Robot & Automation with a trillion won.

According to reports, South Korea plans to inject over 1 trillion won (approximately $707 million) into a newly established sovereign wealth fund next year, focusing on artificial intelligence (AI) and other strategic industries. This move aligns with the global trend of governments mobilizing investments and seizing opportunities in high-tech sectors. Min Kyung-seol, South Korea's Deputy Minister of Finance for Innovation and Growth, stated on Tuesday, "Details cannot be disclosed, but the investment amount for next year may range between 600 billion and 1 trillion won." He added that the final investment amount could exceed the initial estimate, depending on the targeted goals and capital needs. He also clarified that there are currently no plans for the fund to invest directly in Samsung Electronics and SK Hynixtwo chip manufacturers that have become key pillars of the global AI boom. The new fund aims to target sectors such as AI, Siasun Robot & Automation, energy, and others, focusing on post-Series B enterprises. Last month, South Korea announced it would inject 200 trillion won into the Korea Investment Corporation (KIC) for investments in artificial intelligence, data centers, and infrastructure. Min indicated that the newly established fund would grant KIC independent strategic investment authority beyond its traditional foreign exchange reserve management functions. He also mentioned that the fund would focus on infrastructure sectors like Siasun Robot & Automation, energy, batteries, and power grids. Nuclear power, space, and quantum technology are also under consideration. In terms of investment strategy, the new fund will concentrate on enterprises that have already passed their early startup phase, particularly those with mature business models entering Series B and beyond financing rounds. Additionally, when other investors seek to exit, the fund may also acquire shares in companies or projects, an approach Min referred to as "relay investment." As of the end of last year, the KIC managed assets totaling $232 billion. Min stated that the new fund would operate separately from traditional fund management activities and would have independent investment strategies and objectives. He added that unlike KIC's existing foreign exchange reserve fund, which only invests overseas, this new fund will engage in long-term direct equity investments both domestically and internationally. As global sovereign funds rush to acquire AI assets, South Korea aims to take on a guiding role. This move by South Korea comes at a time when global sovereign wealth funds are increasingly targeting AI-related assets. Abu Dhabi's Mubadala Investment Company is considering investing 1 trillion yen (approximately $6.3 billion) to build data centers in Japan; Singapore's Temasek Holdings is looking to participate in pre-IPO financing for Shenzhen data center optical connection product supplier Aidetai. In the wave of global sovereign wealth funds competing to chase AI assets, South Korea has chosen a path that combines pragmatism and ambition: to not engage as early adventurers but rather to be the "relay runners" in mature sectors and the "guides" for global capital. Min stated that sovereign wealth fund and pension fund investors from the Middle East, Europe, and North America have already contacted the South Korean government to discuss potential investments in South Korea and possibilities for co-investing with the new fund. He did not disclose the identities of the specific investors, noting that related discussions are still in the early stages. He added, "Various public funds are indeed in operation, and we are actively exploring pathways to establish a unique positioning for this fund." Regarding overseas investments, Min stated that the fund would target key minerals, resources, and other assets that would help strengthen South Korea's strategic supply chain, potentially collaborating with domestic funds and professional investors to advance related investments. Min indicated that the South Korean government would set overall strategic priorities through the fund's operations committee, while KIC's board of directors and investment committee would be responsible for specific investment and allocation decisions. He remarked that the government would not interfere in individual transactions. "We are working to establish a sovereign wealth fund as an anchor investor to help attract investments to South Korea and co-invest with leading global investors," Min stated.