South Korean President Lee Jae-Myung announced Monday a $300 million global AI investment fund launching in Singapore by 2030, marking the first time Korea has established an offshore government-backed fund-of-funds outside its borders. The Korea Venture Capital Corporation fund targets AI and deep tech startups in both countries as Seoul seeks to build competitive advantages against US and Chinese AI dominance.
Breaking from Domestic-Only Capital Model
President Lee unveiled the initiative at the Korea-Singapore AI Connect Summit, where government officials and AI sector experts from both nations gathered to formalize joint research and investment opportunities. The announcement represents a fundamental shift in Korean startup policy from domestic subsidies to global capital infrastructure.
"We are now in the midst of a massive civilizational transformation driven by AI," Lee stated. "Amid these waves of change, it is inevitable that Korea and Singapore, both of which possess world-class AI capabilities, join hands."
The fund represents Korea's Ministry of SMEs and Startups' first offshore global fund, scheduled to launch in Singapore during the second half of 2026. Unlike traditional Korean venture capital confined to Seoul, this fund-of-funds will operate from Singapore's financial hub, providing international investors access to curated Korean deep tech startups while offering Korean founders entry into Southeast Asian markets.
$34M Joint Research Program Anchors Technical Collaboration
Alongside the venture fund, Korea's Ministry of Science and ICT announced a 50 billion won ($34.2 million) international joint research program spanning five years beginning in 2027. The initiative connects Korea's Institute for Information & Communications Technology Planning & Evaluation with AI Singapore, prioritizing projects involving Singaporean partners.
The research funding aims to bridge the gap between KAIST's engineering capabilities and Singapore's AI implementation infrastructure, particularly in autonomous driving, high-performance computing, and AI manufacturing applications.
Seven MOUs Formalize Strategic Partnerships
The summit concluded with seven Memorandums of Understanding establishing concrete collaborations. Key agreements include research partnerships between KAIST Graduate School of AI and National University of Singapore School of Computing, plus autonomous driving partnerships linking Korea's Autonomous a2z with Singapore's NCS and SMRT transit operators.
Lee emphasized bilateral AI cooperation must evolve beyond technology exchanges into "a strategic industrial partnership to explore new AI-driven markets and position the two countries as Asia's leading innovation hub."
Complementary Strengths Drive Alliance
The partnership leverages distinct competitive advantages. South Korea brings strengths in semiconductors, data center infrastructure, and manufacturing AI, while Singapore offers advanced AI governance frameworks, regulatory expertise, and serves as Southeast Asia's primary AI data hub.
Lee acknowledged the global AI industry remains dominated by the United States and China but expressed confidence Korea and Singapore can lead in specific niches. "If the two countries set clear goals and collaborate to fill in each other's gaps, I am confident that they can lead in specific areas," Lee stated. "They can build competitiveness in human-centric research and development and new applications."
Private Sector Network Launches Alongside Government Initiative
Lee also welcomed the launch of the Korea-Singapore AI Alliance, a private-sector network linking startups, entrepreneurs, and researchers from both countries to promote collaboration. The government pledged support for the alliance's activities, positioning it as "the starting point of an open innovation ecosystem."
The $300 million fund targets deep tech sectors including AI, autonomous driving, and high-performance computing infrastructure, explicitly moving away from consumer applications toward capital-intensive technical infrastructure that Korean startups have historically struggled to finance domestically. By establishing permanent presence in Singapore's neutral jurisdiction, Seoul signals Korean AI startups are ready for international pricing standards rather than domestic protection.
