Korea's AI Industry Ranks 6th Globally... "Need to Address Talent Shortage and Investment Slump"

Hankyung Association, Insights on Korea's AI Industry from the Global AI Index

South Korea's artificial intelligence (AI) industry ranks sixth globally, excelling in patents and policy sectors but requiring improvements in talent, research levels, and investment. There are calls for active regulatory relaxation to address the shortage of talent and management difficulties faced by AI companies, aiming to reduce the technology gap between the US and China and enhance national competitiveness.

On the 12th, the Korea Economic Association announced that according to an analysis of the 'Global AI Index,' which compares AI industry levels by country, South Korea ranks 6th overall among 62 countries. By category, patents (development) and policy (government strategy) sectors are strong, while operational environment, talent, research level, and private investment are weak and need supplementation.

The current AI industry is dominated by the US-China duopoly. The United States leads in five categories?talent such as AI specialists, infrastructure like internet and mobile, research level including academic papers and R&D, patents (development), and private investment including the number of AI companies and investment scale?securing the overall 1st place. China ranks 2nd overall, following the US in infrastructure, research level, patents (development), and private investment sectors.

South Korea, ranked 6th overall, is 3rd in the patents (development) category, which reflects the number of AI-related patents. Analyzing cumulative patent applications related to large-scale AI from 2011 to 2020 by institution, Samsung ranked 1st, surpassing major US and Chinese companies such as IBM (2nd), Google (3rd), and Baidu (5th). Additionally, South Korea ranked 6th in the policy (government strategy) sector, which indicates the government's AI national strategy and investment plans, showing excellence in the scale and duration of AI public investment.

On the other hand, the operational environment category, which reflects the regulatory environment surrounding the AI industry including data-related laws, ranked 11th, falling outside the top 10. The talent category, representing the number of AI specialists, ranked 12th, also missing the top 10. Particularly, in the subcategory of the number of data scientists and engineers, South Korea ranked 20th, revealing a shortage of data analysis talent. The research level category, which includes AI-related publications and R&D scale, also ranked 12th.

The weakest sector in South Korea's AI industry is private investment. In the private investment category, which includes the number of AI companies and investment scale, South Korea ranked 18th, the lowest among the seven categories. The index score was only 8.3 points, less than one-third of the top 10 countries' average score of 29.0.

Specifically, South Korea lacks both the number of AI-related companies and investment scale. In the subcategory of the number of AI-related listed companies within private investment, South Korea ranked 11th with a total of six companies, lagging behind the US (172 companies), China (161 companies), as well as Japan (26 companies) and Taiwan (9 companies). The average investment scale per AI company also ranked 19th.

The Korea Economic Association emphasized that to leap into the top three AI powers, South Korea needs to improve its insufficient talent level and actively relax regulations to resolve management difficulties faced by AI companies. Choo Kwang-ho, head of the Economic and Industrial Headquarters, stated, “Since the AI industry has a significant ripple effect on other industries such as manufacturing and services, we must reduce the technology gap with the US and China to enhance national competitiveness,” adding, “We need to foster domestic talent and actively attract high-level foreign talent through visa regulation relaxation, and revitalize private investment by easing regulations under the Personal Information Protection Act and the Credit Information Act.”

This content was produced with the assistance of AI translation services.