AI Memory Shortage: Could This Trigger A Global Geopolitical Crisis? Here's What Report Says
SK Group Chairman Chey Tae-won warns that the acute shortage of AI memory chips may soon trigger geopolitical strain. With demand for 2027 projected to far exceed supply despite production increases, governments are moving to secure chip access as a national security priority, potentially escalating tensions between major global economic powers.
Group Chairman Chey Tae-won has issued a stark warning regarding the global artificial intelligence memory chip market, suggesting that persistent supply shortages could soon evolve into significant geopolitical friction. Despite rapid efforts to expand production capacity, industry leaders anticipate that the demand for these critical components will continue to outpace available supply until at least 2027.
The situation has prompted major industry players to reassess their strategic positioning as the technology sector grapples with an unprecedented surge in consumption. As per a The Korea Herald report, Chey highlighted that major clients are already requesting between 60% and 100% more AI memory by 2027 than is currently available. With AI applications now driving more than 50% of total semiconductor demand, the industry is witnessing an overall consumption growth of at least 50% to 60%, leaving production capacities severely strained. Micron Says Apple Supplier Demand Drove Global Memory Shortage.
Here's What Report Says On Supply Constraints
During a press briefing at the Korea Chamber of Commerce and Industry's Jeju Forum, Chey emphasised that the current expansion of production facilities is essentially the lifeline for the nation's semiconductor industry. He noted that no major manufacturer has significant new capacity expected to come online within the next year, leaving the market in a precarious state of imbalance.
Data from Counterpoint Research indicates that SK hynix dominated the high-bandwidth memory market in the first quarter of 2026, capturing 58% of global revenue, while competitors Micron and Samsung each held 21%. Chey explained that as this supply gap widens, memory access is increasingly being viewed as a matter of national economic security, moving the issue from corporate boardrooms to government agendas. OnePlus, Xiaomi Raise Prices by Up to INR 5,000 on Select Devices; Check List Here.
Rising Geopolitical Pressure On Semiconductors
Governments across the globe are already taking steps to intervene on behalf of domestic industries to secure these essential chips. Chey suggested that while private companies are currently absorbing the intense pressure of these supply-demand imbalances, it is only a matter of time before these tensions manifest as direct diplomatic conflicts between nations. The race to secure high-bandwidth memory is rapidly transforming into a primary focus for international economic policy, potentially reshaping trade relations in the technology sector as states prioritise their own infrastructure needs.
(The above story first appeared on LatestLY on Jul 20, 2026 04:18 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).