South Korea plans to establish a “Future Response Fund” using additional tax revenue generated by a recent semiconductor industry boom to invest in key growth sectors, support younger generations, and address widening economic inequality. The announcement was made by senior officials from President Lee Jae Myung’s administration during a government and ruling Democratic Party meeting on Sunday.

The fund is intended to finance major national investment projects and enhance South Korea’s long-term competitiveness in global markets. Presidential chief of staff Kang Hoon-sik described the initiative as a critical measure at a pivotal moment for the country’s future, emphasizing the importance of not dissipating the extra tax revenue derived from the semiconductor upswing and other sources.

President Lee unveiled three large-scale industrial projects earlier this week, focusing on semiconductors, physical artificial intelligence (AI), and data centres. These ventures are supported by planned investments amounting to hundreds of billions of dollars from major technology firms Samsung Electronics and SK Hynix, alongside government contributions. The strategy also aims to promote economic development beyond the Seoul metropolitan area, seeking to reduce regional disparities.

The Future Response Fund will support these “mega projects” while also addressing what officials have referred to as a “K-shaped” economic recovery—where certain sectors or social groups prosper while others face stagnation or decline. In particular, the fund aims to provide housing assistance, startup support, and employment opportunities targeting people in their 20s and 30s, viewed as a key demographic for future growth.

Officials framed the fund as a foundational element in realizing President Lee’s vision of making South Korea an irreplaceable player on the global stage. They called for close collaboration between the government and the ruling party to ensure swift implementation of the fund’s objectives.

This approach reflects the administration’s dual focus on leveraging the country’s strengths in semiconductor and AI technologies while addressing social and economic inequalities intensified by recent shifts in the global economy. By channeling windfall revenues into strategic investments and social support, South Korea aims to sustain robust growth and foster inclusive development in the years ahead.