South Korea intends to include 56.5 billion won — approximately $40 million — in its defense budget for 2027 for the development of defense-related semiconductor technologies. According to a correspondent for the Vietnam News Agency in Seoul, the new investments are part of a defense budget draft prepared by the government and submitted to the National Assembly for review. The goal of the program is to reduce the country's dependence on foreign components and strengthen self-sufficiency in supply chains for strategic technologies.
What is Included in the Budget Draft
According to the agency, the funds are focused on developing key semiconductor technologies and establishing a stable supply base for advanced weapon systems. Importantly, this is still a draft: the expenditure item has not yet been finally approved and must undergo the review process in the National Assembly. Thus, the allocated amount reflects the government's intention rather than actual procurement or contracts already carried out.
The Scale of Import Dependence
The severity of the problem is highlighted by a 2023 survey published in South Korean defense industry documents. Out of 6,945 types of semiconductor components used in 54 key weapon systems, only 78 are produced domestically. Dependence on foreign suppliers reaches 98.9%. These components are used in radar systems, guided weapons, and military communications — elements critical to combat readiness.
Why Defense Chips Are a Special Case
The high level of import dependency shows that South Korea's strong positions in the commercial semiconductor sector — where manufacturers like SK hynix and Samsung produce billions of memory chips — have not automatically translated into self-sufficiency in defense microchips. Unlike mass-produced memory chips, defense components are produced in numerous variants in small batches and must meet the specific requirements of each particular weapon system. In addition, replacement parts must undergo rigorous reliability and safety testing before commissioning.
Technological Sovereignty as a Priority
The government views the development of defense semiconductors as part of efforts to strengthen technological sovereignty and defense capabilities. Amid growing technological competition and risks inherent in global supply chains, securing access to key components is recognized as crucial for the development, production, and operational maintenance of weapon systems.
What Will Determine the Program's Success
According to the agency's assessment, the effectiveness of the plan will depend on the country's ability to develop its own technologies, enterprise participation, and the capabilities for testing and certifying components according to special defense industry standards. If successfully implemented, the program can reduce the risks of supply chain disruptions and enhance South Korea's technological self-sufficiency in a strategically vital segment.
