South Korean Finance Minister Lee Hyoung-il said the semiconductor expansion could continue through at least 2027 because demand remains well above supply even as manufacturers add capacity. He made the assessment Saturday during the IMF and World Bank meetings in Bangkok, after a week of steep declines in chip shares.
The sell-off hit South Korean companies including SK hynix and Seoul Semiconductor, as well as Nvidia in the United States. Investors were concerned about potentially higher interest rates and stronger competition from Chinese producers.
Recent international forecasts have also tied South Korea’s growth outlook to semiconductor exports.
Lee had previously described the AI-driven chip boom as supporting improving exports and investment, while warning that the country must remain resilient to trade and geopolitical risks. The semiconductor surge is also improving the tax outlook, with the government expecting this year’s collections to exceed its earlier estimate. IMF officials have urged South Korea to treat those gains cautiously and preserve fiscal room because an AI-related market correction, higher borrowing costs and accumulated public debt could weaken the ability to respond to a future downturn.