South Korea's AI chip boom sparks wealth surge and growing inequality

Powered by chipmakers Samsung Electronics and SK Hynix, South Korea is seeing a surge in wealth, but there are questions over who gets to share in the profits. When South Korea’s most high-profile divorce case returned to court last month, the lawyers were arguing not just about the breakdown of a relationship, but also the exact date at which to value shares in one specific company. The judges’ decision in Seoul could change the value of business tycoon Chey Tae-won’s assets by billions of dollars.

The shares were in the holding company behind SK Hynix, the manufacturer of chips powering AI systems around the world. The dispute highlights the immense wealth being generated by South Korea’s chip industry, which has seen a 3,000% bonus payout to employees. However, concerns are growing about the widening wealth divide, as the benefits of the boom appear to be concentrated among a select few.

The valuations of Samsung Electronics and SK Hynix have soared in recent years, driven by the insatiable demand for AI chips. The two companies are among the world’s leading manufacturers of memory chips, which are used in everything from smartphones to data centers. The South Korean government has implemented policies aimed at spreading the benefits of the chip industry more widely, but it remains to be seen whether these efforts will be effective in addressing the growing wealth divide.

The AI chip boom in South Korea has significant implications for the broader tech industry, as companies around the world vie for access to the high-performance chips needed to power AI systems. As the demand for these chips continues to grow, South Korea's chipmakers are likely to remain at the forefront of the industry. However, the wealth divide in South Korea raises questions about the distribution of benefits from this growth.

Will the government be able to implement policies that spread the wealth more evenly, or will the benefits continue to accrue to a select few? The answer will have important implications for developers, businesses, and consumers, both in South Korea and around the world.