South Korea plans chip windfall fund to support youth, AI investment

South Korea is doing something unusual with its chip money: sharing it. The government under President Lee Jae Myung is building a “Future Response Fund” designed to channel unexpected tax revenues from the semiconductor boom into youth employment, housing, startups, and AI infrastructure. The initiative, first discussed at a ruling Democratic Party meeting on July 5, represents Seoul’s attempt to convert a cyclical tech windfall into structural, multi-decade economic policy. The architecture of a chip dividend The fund operates on two main tracks. The first is the Future Response Fund itself, targeting domestic priorities like affordable housing, youth-focused startups, and educational programs. Labour Minister Kim Young-hoon emphasized on July 9 that the fund would specifically support people in their 20s and 30s, a demographic that has faced persistent unemployment and housing affordability challenges in South Korea. The second track is more globally ambitious. On July 31, the government detailed a $13.6 billion strategic investment account to be managed by the Korea Investment Corporation, South Korea’s sovereign wealth fund. That capital will flow into AI, semiconductors, crit...