South Korean chips head to Saudi Arabia as manufacturing meets computing

The next contest in semiconductors is not only about who makes the chips. It is increasingly about who has enough energy, data-center capacity, and digital infrastructure to run the artificial intelligence systems that depend on them.

That shift is bringing South Korea and Saudi Arabia closer together. Rebellions, a South Korean maker of AI chips, plans to establish its regional headquarters in Riyadh as Saudi Arabia expands its ability to accommodate rising demand for computing and invests in data centers and AI projects.

Rebellions CEO Sunghyun Park told Asharq Al-Awsat that three factors made Saudi Arabia attractive: high energy availability, a commitment to developing AI infrastructure, and strong ambitions to build sovereign AI. Together, he said, they make Riyadh a suitable base for expanding the company’s AI chip business.

Saudi Arabia is seeking to build a sovereign AI ecosystem, while South Korea is trying to strengthen its place across the semiconductor value chain. Seoul has proposed an 821 trillion won budget for 2027, worth $596.92 billion, representing a 12.8 percent increase from the current year and the largest annual rise in its history.

A substantial share of the proposed spending would support AI, semiconductors, and related infrastructure. The plan includes 21.3 trillion won for industrial water systems, electricity grids, and logistics services needed for next-generation semiconductor facilities, as well as 2.6 trillion won for a dedicated semiconductor budget.

South Korea is also benefiting from surging demand for high-bandwidth memory, or HBM, used in AI systems. Samsung Electronics and SK Hynix have reported strong profits as that demand grows. Park said the sovereign dimension of AI has become an important factor in countries’ decisions, a consideration now connecting Riyadh’s computing ambitions with Seoul’s chip expertise.

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Sovereign AI has become an important factor in countries' decisions.