U.S. Investment in AI Infrastructure Surges, Driven by Political and Economic Factors
Despite concerns surrounding a potential “AI bubble” in the U.S.โข stock market, the Unitedโ States is experiencingโ a notable boom inโ large-scale infrastructure investment, particularly focused on โAI data centers. construction spurred by these data centers reached a record high in October of last year, and this trend โขis projectedโค to continueโ well into โฃnext year.
This โฃsurge isโ fueled, in part, by the Trumpโ management’s foreign โeconomic policy, which โutilizesโค tariff pressure to โattractโ approximately $9.6 โคtrillion (roughly KRW 1 trillion) in investment from international companiesโฃ and governments. With the U.S.fiscal deficitโฃ currentlyโ atโ $1.8 trillion (approximately 2,600 trillion won) as ofโข fiscal year 2025, accelerating the execution of these pledged investmentsโ is โคa priority.
Analyst Kang Jae-gu of Hana securities, in aโฃ recent report, anticipates that the Trump administrationโ will prioritize AI industry growth and โmanufacturing reshoringโค as key economic strategies leading up to the November midterm elections. This proactive approach is expected to โfurther boost โคinvestment.
Data from Dodge Momentum Networks, a U.S. construction research firm,demonstrates theโ scale of this growth.The construction start index has surpassed its 2022 peak, with October 2023 seeing $1.528 trillion (approximately 2,230 โขtrillionโ won)โ in construction starts – a 32.5% increase year-over-year and an all-time high. The utility sector, crucial for data center operations, experienced a dramatic increase of 384.5%, while non-residential building construction, โincluding offices and data centers, rose byโ 45.5%.
Beyond infrastructure, the โฃU.S. is also strengthening its reshoring policies,โ aimingโ to โคbring manufacturing back to โขdomestic soil. While the Biden administration employed subsidies and tax โincentives like the Inflation Reductionโค Act (IRA) and the CHIPS โฃAct, the trump administration โis leveraging investment commitments secured through tariff negotiations. The administration is expectedโฃ to โคemphasize the effectiveness of this “shock therapy” approach – โutilizing strongโฃ tariff measuresโค – overโ customary subsidy-based policies โto expedite investment execution from global entities.
(Image caption: Facebook data center to be built in Forth Worth, Texas)
Source: asia Economy (www.asiae.co.kr)