The first public-private agreement to emerge from President Lee Jae Myung's declaration of three national mega-projects arrived within a week — a sign of how urgently both large corporations and local governments recognize that speed is the defining currency of the AI era.
The agreement among GS Group, Gangwon Special Self-Governing Province and Donghae City centers on building a large-scale AI data center complex in Donghae. Its stated purpose is to create a fast-track development path by strengthening inter-agency cooperation, streamlining licensing and administrative procedures, and coordinating among relevant authorities.
Under the agreement, each party will jointly address major issues that arise during the project and work together on support measures — including a fast-track licensing regime, infrastructure development and inter-agency coordination — to keep the project on schedule.
The deal also carries an implicit lesson for SK Group's planned AI data center in the Gangneung area, where power supply issues have stalled final site selection: Korea Electric Power and other stakeholders should move quickly to resolve the remaining details in the broader national interest.
Donghae City said it will maintain close cooperation with Gangwon Province and relevant agencies to ensure the project proceeds without disruption. "The AI data center campus is a core project that will strengthen Donghae's future industrial competitiveness," Mayor Lee Jeong-hak said. "We will work closely with all relevant agencies to ensure the project moves forward smoothly."
At the opening of the signing ceremony, Lee Ju-heon, head of Gangwon Province's AI Data Center Promotion Team, said President Lee had laid out a national growth governance blueprint aimed at making South Korea one of the world's top three AI powers and a top-five nation by overall national strength. "In line with that policy direction, the government announced in June this year the three national mega-projects — centered on semiconductors, physical AI and the construction of AI data centers as critical infrastructure," Lee said. "GS Group has now moved forward with its Donghae AI data center project, leveraging the East Coast region's strong power infrastructure — including renewable energy — and stable site conditions, in strategic partnership with global IT companies. Today's agreement is the result of that effort."
Lee added that licensing procedures are already moving quickly toward a target completion date of December 2028. A second phase is scheduled for completion in 2029.
GS Vice Chairman Hong Sun-ki said the group had designated AI data centers as a core future business and had been preparing steadily. "What matters most is speed," Hong said. "If we succeed by moving fast, this project will have a significant ripple effect — revitalizing the local economy, creating jobs and building a related ecosystem. It will be a pivotal moment that redraws South Korea's future industrial map." According to GS, once the Donghae AI data center is completed, it will rank first in Asia and between 10th and 15th globally in data center capacity by IT load — with most higher-ranked facilities located in the United States. The project is expected to employ about 70,000 workers during construction and around 2,000 in direct permanent positions afterward.
GS's direct investment stands at 30 trillion won ($19.5 billion), and the total investment including GPUs, memory chips and other components is estimated at around 120 trillion won.
Additional economic benefits are also expected, including increased foot traffic, a boost to the services sector and a rise in the city's brand profile.
Gangwon Governor Woo Sang-ho reflected on the path that led to the agreement, saying that pursuing both industrial transformation and balanced regional development had long been President Lee's strategy — one he said he had helped shape during his time at Cheong Wa Dae. "This year, that vision has begun to bear real fruit," Woo said. "We will do everything we can to help GS's investment plans grow and succeed. Our provincial and municipal governments commit again to providing maximum support — including administrative assistance on licensing — and to ensuring that Asia's largest AI center succeeds."
Woo added that the province would devise a meticulous support strategy and help GS Group "at a pace that will be genuinely surprising." "Let us work together not only to achieve great development for Gangwon Province, but also to create opportunities for Gangwon's talent to grow by working at major companies," he said.
Lee Cheol-hyu, head of Korea Electric Power's Gangwon regional office, said he had come to appreciate the province's considerable advantages since taking up his post. "Gangwon has strong energy resources — renewable energy, solar, wind — but it was frustrating that, because industry had not expanded enough to absorb it, we were sending surplus power to the greater Seoul area and the Chungcheong region," he said. "Now that major companies are making large-scale investments, Gangwon has a great opportunity, and I intend to provide maximum support as head of KEPCO's Gangwon office." He also expressed hope that SK Group's AI data center project in Gangneung would advance quickly.
abc@heraldcorp.com
