U.S. Investment in AI Infrastructure Surges, Driven by Political and Economic Factors
Despite concerns surrounding a potential “AI bubble” in the U.S. stock market, the United States is experiencing a notable boom in large-scale infrastructure investment, particularly focused on AI data centers. construction spurred by these data centers reached a record high in October of last year, and this trend is projected to continue well into next year.
This surge is fueled, in part, by the Trump management’s foreign economic policy, which utilizes tariff pressure to attract approximately $9.6 trillion (roughly KRW 1 trillion) in investment from international companies and governments. With the U.S.fiscal deficit currently at $1.8 trillion (approximately 2,600 trillion won) as of fiscal year 2025, accelerating the execution of these pledged investments is a priority.
Analyst Kang Jae-gu of Hana securities, in a recent report, anticipates that the Trump administration will prioritize AI industry growth and manufacturing reshoring as key economic strategies leading up to the November midterm elections. This proactive approach is expected to further boost investment.
Data from Dodge Momentum Networks, a U.S. construction research firm,demonstrates the scale of this growth.The construction start index has surpassed its 2022 peak, with October 2023 seeing $1.528 trillion (approximately 2,230 trillion won) 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, including offices and data centers, rose by 45.5%.
Beyond infrastructure, the U.S. is also strengthening its reshoring policies, aiming to bring manufacturing back to domestic soil. While the Biden administration employed subsidies and tax incentives like the Inflation Reduction Act (IRA) and the CHIPS Act, the trump administration is leveraging investment commitments secured through tariff negotiations. The administration is expected to emphasize the effectiveness of this “shock therapy” approach – utilizing strong tariff measures – over customary subsidy-based policies to 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)
