Even before the political crisis began, concerns were raised that South Korea’s policy plans and strategies might fall far short of achieving its ambitious goal of becoming a global leader in AI innovation.
SEOUL – Time passes regardless of what we do — whether we study, work, pause for rest or sleep after a long day of hard work. Most of us were enjoying an extended Lunar New Year holiday in South Korea when the world was rocked by the debut of a groundbreaking generative AI model developed by a Chinese startup.
Global capital markets experienced significant turbulence following the introduction by China’s DeepSeek of a generative AI model with the same name. Developed at a fraction of the cost of its American counterparts, DeepSeek demonstrated capabilities comparable to or even stronger than leading AI systems, challenging the dominance of major US tech companies.
US tech giants, particularly those heavily invested in artificial intelligence, saw substantial declines in their stock valuations. Nvidia, for instance, suffered a historic 17 percent drop, wiping $589 billion from its market capitalization in one day, although it recovered some of the losses thereafter. Other major tech firms also faced significant stock price downturns.
In response to these developments, policymakers and industry leaders around the world are closely monitoring the situation, with the US launching a review to assess the implications of DeepSeek’s AI model regarding data privacy and potential foreign influence operations. Analysts are also evaluating the broader impact on the AI industry, considering the possibility of a shift towards more cost-effective and open-source innovations.
South Korean capital markets also reacted violently when they reopened for trading on January 31 after the four-day rout. Share prices of chipmakers Samsung Electronics and SK Hynix plunged, while those of companies like Naver and Kakao surged as investors adjusted their portfolios in response to the changing landscape of the AI industry.
I am not trying to add to the thousands or millions of news articles, research reports, social media posts and newsletters published every day about the shocking emergence of DeepSeek, its technological aspects and its implications.
Instead, I am discussing this incident because it serves as a stark warning for South Korea’s ambitious goal of positioning itself among the world’s top three AI leaders in the near future.
South Korea launched the Presidential Committee on AI — also known as the National Committee on AI — in late September 2024 as the highest-level organization tasked with reviewing, coordinating and formulating strategies and policies best suited for the country to become a global leader.
Now-suspended President Yoon Suk Yeol, who is the sole chair of the committee, declared that fostering AI capabilities is the top priority for his government and would receive the best of the national resources available.
Some of the plans presented at that time have indeed been implemented, such as the establishment of the AI Safety Institute in November, the overwhelming approval of the framework law on AI by the opposition-controlled parliament in late December and the announcement of AI policy plans for 2025 by the Ministry of Science and ICT based on the annual government budget bill.
However, the country has been virtually at a standstill apart from these achievements, as it fell into political turmoil sparked by Yoon’s botched attempt to declare emergency martial law in early December, the resultant suspension of Yoon from duty upon parliamentary impeachment, as well as his arrest and separate indictment on charges of leading an insurrection and committing abuse of power.
You can’t claim that everything would have gone smoothly with South Korea’s efforts to keep up with or even surpass the global pace of AI innovation, nor that China’s shockingly fast progress in the AI sector — demonstrated by the successful and awe-inspiring emergence of DeepSeek — would have been impossible without the political turmoil.
Even before the political crisis began, concerns were raised that South Korea’s policy plans and strategies might fall far short of achieving its ambitious goal of becoming a global leader in AI innovation. The government had refused to increase funding for core technologies, including AI, as it was more focused on curbing the growth of government debt than pursuing other national objectives.
The Ministry of Science and ICT, which spearheads the country’s AI policy, complained that the parliament passed this year’s budget after scaling down total spending plans, ignoring its request for increased funding for AI projects. It has said it had to request for an upward revision to spending plans after the usual deadline because of the fast-changing global AI industry.
Key members of both the ruling and opposition parties recently acknowledged both privately and publicly that they were close to an agreement to increase government spending on AI and other critical areas but were ultimately unable to do so due to political conflicts with each other.
Since the beginning of the year, the Science Ministry has repeatedly called for parliamentary support for additional AI project funding and announced plans to scale up investment in establishing the national AI computing center and intensifying other policy measures.
In addition, the country’s economic situation continues to deteriorate at such an alarming pace that even the central bank governor has publicly called for swift action by the government and parliament to draw up a supplementary budget.
However, the ruling and opposition parties have been mired in the political turmoil, in my view to secure advantageous positions under the assumption that the Constitutional Court will uphold Yoon’s impeachment within the next six months and that an early presidential election will be held this year.
While winning an election is undoubtedly a top priority for any political party, it must also be noted that an election victory will become meaningless if the country becomes too weak to recover or lags too far behind to catch up.
There’s a famous Korean proverb that can be literally translated as “What could have been stopped with a hoe has become a situation that can’t be stopped even with a large spade.” There are several English expressions with a similar effect, including “An ounce of prevention is worth a pound of cure” and “A stitch in time saves nine.”
I want to emphasize that, for South Korea’s political parties, now is not a time to debate which expression to use, but rather to sit down and find a way to prevent catastrophe while they still can.
Published by: Yoo Choon-sik
