South Korea

Intelligence for Better Decision Making

AI Adoption Transforms Medical Imaging and Diagnostics Amid Trust and Integration Challenges

Sept. 2, 2025 | Health

Artificial intelligence is revolutionizing medical imaging and diagnostic care by offering powerful tools to enhance patient outcomes and streamline clinical workflows.

**Philips Korea’s Future Health Index 2025 Korea Report finds that 86% of Korean healthcare professionals expect AI to enhance patient treatment outcomes.**
They predict that AI will boost patient acceptance of care, shorten consultation wait times, trigger timely clinical interventions, automate repetitive administrative and clinical tasks, and foster preventive care innovations through predictive analytics and remote monitoring. These capabilities could enable early life-saving interventions and reduce hospital admissions. Based on a survey of over 1,900 medical professionals and 16,000 patients across 16 countries—Korea’s first inclusion in the study—these insights reflect strong professional optimism. However, only 60% of Korean patients share this view, although their confidence remains above the global average. Patients voice concerns about reduced face-to-face time with physicians and the risk of depersonalized care, while medical professionals identify unclear legal liability for AI-related errors as their primary worry. Even though 84% of healthcare workers have contributed to the development of new AI technologies, just 46% feel that those tools address their needs.

**The report also exposes significant delays and inefficiencies in the Korean healthcare system.**
Many patients endure long waits for specialist consultations, and clinicians lose substantial clinical time managing incomplete, fragmented, or inaccessible patient data. These operational bottlenecks highlight the need to improve data integration and optimize workflows alongside AI deployment.

**Both patients and medical professionals outlined specific factors that would foster their trust in AI.**
Patients prioritize demonstrable reductions in clinical errors, lower overall healthcare costs, and measurable improvements in health outcomes. Professionals, meanwhile, demand clear guidelines on appropriate AI use, definitive regulations that address legal liability for errors, and assurances that AI tools align with clinical workflows and user requirements.

**To address these concerns, Philips proposes five measures to strengthen trust in medical AI: design AI solutions around patient and clinician needs; enhance human–AI collaboration rather than replace human judgment; rigorously demonstrate the effectiveness, safety, and fairness of AI applications; establish unambiguous usage guidelines and legal frameworks; and foster cross-disciplinary partnerships to bolster governance and oversight.**
Choi Nak-hoon, CEO of Philips Korea, emphasizes that reinforcing trust in medical AI will accelerate innovation and deliver measurable benefits for patients and providers alike.

**Proof-of-concept data from Yonsei University Yongin Severance Hospital shows that AI integration improved patient satisfaction scores and staff efficiency metrics, demonstrating that building trust among both patients and healthcare professionals is essential for successful AI adoption and sustained clinical impact.**

South Korea Unveils Record 2026 Budget Focused on AI-Led Economic and Innovation Transformation

Sept. 2, 2025 | Technology & Innovation

South Korea’s 2026 budget proposal prioritizes artificial intelligence and strategic innovation to address economic and demographic challenges.

**The government has proposed a 728 trillion-won budget for 2026, an 8.1 percent increase (54.7 trillion won) from the previous year and the largest since the early 2020s.**
Policymakers present this package as a targeted response to economic slowdown, an aging population and the need for an “AI great transformation,” boosting overall fiscal spending while emphasizing strategic management over indiscriminate expansion.

**Within the total, the government allocates 10.1 trillion won specifically to AI—three times this year’s amount.**
Of that, 2.6 trillion won will drive AI integration across industries, daily life and the public sector, funding manufacturing-based AI, autonomous vehicles and ships, AI-enhanced products and improvements in public administration. Another 7.5 trillion won will build AI infrastructure and nurture talent, covering the procurement of 50,000 high-performance GPUs, next-generation AI technology research, expanded AI graduate programs at 24 universities and corporate collaboration training for 10,000 participants.

**Overall R&D funding will rise by 19.3 percent to 35.3 trillion won, restoring earlier cuts and shifting toward performance-driven national projects.**
The government has set priorities in AI, biotechnology, content, defense, energy and manufacturing. Notable initiatives include the AI-Inglass program, customized radiation cancer therapy devices, core technologies for a Korean space telescope and urban carbon capture systems. A 1.9 trillion-won policy-finance package will ease US tariff negotiations by issuing emergency support vouchers, boosting subsidies for strategic SMEs and expanding funding for renewable energy and microgrids.

**To streamline spending, the budget restructures 27 trillion won by cutting poorly executed or unnecessary projects, from selected home-purchase loans and infrastructure schemes to startup budgets and foreign aid.**
While it reduces some mandatory items—such as local education finance grants and mine-closure funds—it defers fundamental reforms of local allocation taxes and education grants, and it omits any restructuring of educational funding in light of a declining school-age population.

**The Ministry of Science and ICT will receive a record 23.7 trillion won, a 12.9 percent increase over last year’s supplementary budget.**
Its R&D component grows by 21.6 percent to 11.8 trillion won, representing 33.4 percent of total government R&D spending. The ministry will manage 5.1 trillion won of the AI budget, including 4.5 trillion won for AI transformation and 600 billion won for AI-driven innovation in science and technology.

**Within that AI allocation, 2.1 trillion won will strengthen computing resources through data center and network infrastructure R&D, hyper-AI network development and construction of a national AI computing center.**
The plan secures an additional 15,000 advanced GPUs, advances AI network technologies and invests in next-generation core technologies—domestic AI semiconductors, neural processing units and physical AI—while supporting regional innovation hubs and AI security systems.

**The budget also targets NEXT strategic technologies to drive an innovation-economy shift.**
The government will intensify R&D in semiconductors, displays, secondary batteries, advanced biotech, quantum computing and foundational materials and future-energy technologies. New funding lines support optical-computing semiconductors and convergent display research, while institutional grants for government-funded research institutes increase to back large, mission-oriented projects, with performance bonuses for top researchers. The plan further expands support for deep-tech startups and technology commercialization.

**To bolster the basic research ecosystem, the government will fund 15,000 projects and expand national research laboratories to concentrate university research efforts.**
It will raise scholarships and living allowances to counter demographic challenges in STEM fields and enlarge programs to attract overseas scientific talent and foster international collaborations, enhancing Korea’s global research competitiveness.

**Aiming for balanced regional and societal growth, the budget allocates resources to strengthen regional R&D innovation capabilities and develop special zones as industry hubs.**
It increases R&D addressing social issues—such as disaster response, drug safety and law enforcement—and promotes public engagement with science through AI digital learning centers and distribution of assistive ICT devices to vulnerable populations.

**The government will submit the 2026 budget proposal to the National Assembly in September 2025.**
Minister Bae Gyeong-hoon said the record funding demonstrates the administration’s commitment to overcoming Korea’s low-growth crisis and advancing an innovation economy centered on AI and science and technology, with a focus on delivering quick, tangible outcomes to citizens.

Monitored Intelligence for South Korea - Sept. 2, 2025

News
Media
282

Government
Releases
11

City/State
Releases
32

Embassy
Releases
0

Foreign
Service
Advisories
0

Academic/
Think
Tank
3

Podcasts
0

Videos
0

Social
Media
0

Business
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1

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김영훈 노동장관 "산재처리 기간 228일서 120일로 단축"

Labor Minister Kim Young-hoon Announces Reduction of Industrial Accident Processing Time from 228 Days to 120 Days

Money Today | Local Language | News | Sept. 2, 2025 | Accidents

Labor Minister Kim Young-hoon announced a plan to reduce the average processing time for occupational disease industrial accident claims in South Korea from 228 days to 120 days by 2027. This initiative involves simplifying procedures and enhancing the expertise of investigation and adjudication personnel. The Ministry of Employment and Labor will expedite compensation claims for workers in 32 specific occupations by allowing adjudication committee deliberations to proceed without special examinations.

The ministry will also expand this expedited processing to additional occupations based on input from labor, management, and experts. For diseases with well-established work-related risks, such as primary lung cancer in mining workers and leukemia in semiconductor workers, the adjudication process will bypass epidemiological investigations to speed outcomes. Dedicated occupational disease teams will be established at all 64 Korea Workers' Compensation and Welfare Service affiliate institutions, and mandatory training for accident investigation personnel will be introduced to strengthen expertise.

Minister Kim emphasized the government's commitment to reducing industrial accident deaths and mentioned the preparation of a comprehensive occupational safety plan involving multiple ministries. The ministry will focus not only on punitive measures but also on incentivizing proactive accident prevention by workplaces. Additionally, the ministry's official abbreviation will change from “Ministry of Employment” to “Ministry of Labor” to reflect a broader policy focus on all working individuals, including those outside traditional employment relationships.

North slams Seoul-Washington-Tokyo statement targeting its cyber threats

Joongang Ilbo | English | News | Sept. 2, 2025 | North Korea

North Korea strongly condemned a recent joint statement by South Korea, the United States, and Japan that criticized its cyber activities. The three countries expressed serious concerns about North Korean IT workers using AI tools and other methods for malicious cyber activities aimed at funding Pyongyang's illicit weapons programs.

The Korean Central News Agency (KCNA) described the joint statement as a "political farce," accusing it of spreading "groundless" rumors to damage North Korea's image and increase international pressure. North Korea warned that continued hostile acts by the U.S. and its allies would only deepen distrust and hostility.

The regime pledged to take "practical measures" to protect its interests from what it called "explicit" acts by hostile countries in cyberspace and beyond, aiming to counteract their perceived malicious effects.

(LEAD) Rise in household loans gathers pace in Aug. despite real estate curb

Yonhap | English | News | Sept. 2, 2025 | UndeterminedReal Estate

Household loans extended by South Korean banks increased by 4.2 trillion won (US$2.87 billion) in August 2025, a rise that accelerated compared to the 2.2 trillion won growth in July. This uptick occurred despite strict regulations introduced in late June, including a 600 million-won cap on mortgage loans in the capital region and a suspension of home-backed loans for multi-homeowners aimed at curbing household debt and housing prices.

The growth in August was driven mainly by a rise in unsecured and other types of household loans. While authorities believe the recent measures have somewhat tempered market overheating, they are considering additional regulations such as tightening the loan-to-value (LTV) ratio. Currently, the LTV ratio is set at 50 percent in anti-speculation areas in Seoul, but market expectations point to a potential reduction to 40 percent.

Lee Eog-weon, the nominated chairman of the Financial Services Commission, emphasized that the government will continue monitoring the housing market and take further action if necessary. He acknowledged both the short-term success of the June measures and the limitations of solely focusing on loan regulations. Lee also highlighted plans to consider comprehensive policies, including possible restrictions on loans related to the jeonse rental system.

Meanwhile, South Korea's top five banks saw their net interest margins approach the highest levels since 2022. The increase resulted from banks maintaining lending rates amid tighter household debt controls while deposit rates fell to their lowest in over three years. Notable month-on-month net interest margin increases were reported by KB Kookmin Bank, Nonghyup Bank, and Hana Bank in July 2025.

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