South Korea has revised its economic growth projection for 2026 upward to 3 percent, representing a five-year high and a 1 percentage point increase from its previous outlook. Growth in Asia’s fourth-largest economy is accelerating, driven by policy measures and a semiconductor supercycle.
The government is maintaining a bullish view of the economy, asserting that an artificial intelligence-driven semiconductor boom will continue to outweigh the impact of the Middle East conflict. As part of this strategy, South Korea has pledged to swiftly advance artificial intelligence investments to further bolster economic performance.
This AI-driven semiconductor boom is also expected to generate a record tax windfall. This provides President Lee Jae Myung’s government with fresh fiscal firepower to fund an ambitious investment agenda.