South Korea's AI Investment Could Strain Companies' Credit Profiles

Dow Jones
Sep 21

0611 GMT - South Korea's aggressive investment in artificial-intelligence infrastructure could strain the credit profiles of companies participating in the AI buildout, S&P analysts say. The country could invest about $900 billion in data centers over the next decade, significantly expanding data-center capacity for telecom and other companies, analysts led by James Kim write in a note. Investment burdens would rise sharply for participating companies, weighing on their credit profiles, they say. The country's aggressive AI buildout--which focuses on data centers, semiconductors and physical AI under President Lee Jae Myung's "Three Mega Projects" initiative--could require 1,800 trillion won to 2,000 trillion won, equivalent to $1.3 trillion-$1.4 trillion, in investments over the next decade for chips and data centers alone, they add.

 

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