* Investments could exceed $650 billion, media say

* Expected southwest chip hub plan aims to ease Seoul-area

concentration

* Lee denies regional favouritism, called project national

survival strategy

* Critics question infrastructure, skilled labour and

political motives behind the plan

By Joyce Lee

SEOUL, June 29 (Reuters) - South Korea is set to unveil

three "mega-projects" to fuel its next growth phase, including a

new semiconductor hub in the southwest that local media say

could attract investments by Samsung and SK spanning hundreds of

billions of dollars over several years.

The announcement would mark President Lee Jae Myung's

boldest push yet to align South Korea's AI and chip ambitions

with his pledge to narrow regional disparities and revive

economies beyond the Seoul metropolitan area.

Lee will preside over the event, framed as a national "great

leap" due to be unveiled around 0500 GMT, his office said, with

ministries covering industry, science, climate and transport set

to outline policy support.

Samsung Electronics ( SSNLF ) and SK are expected to

present investment plans, and their chairmen, Jay Y. Lee and

Chey Tae-won, are among business leaders tipped to attend by

local media.

Representatives of other firms including LG Electronics, HD

Hyundai Robotics, Korea Electric Power Corp and Korea Water

Resources Corp are also attending, Lee's office said.

The package will span semiconductors, AI data centres and

physical AI including robotics, Lee's office said, while the

president's social media posts signalled a new chip cluster

planned for the underdeveloped southwest, including Gwangju and

South Jeolla province.

Local media have reported the planned investments could

exceed 1,000 trillion won ($651.41 billion) over coming years.

Besides Samsung Electronics ( SSNLF ), South Korea is also home to SK

Hynix, the world's two largest memory chipmakers,

whose high-bandwidth memory (HBM) chips are pivotal in the

global race to build advanced AI systems. Both companies already

operate major semiconductor facilities in and around the Seoul

metropolitan area.

The government is also set to detail extensive support

measures covering power, water, land, infrastructure, workforce

training and housing.

Lee has defended the proposed southwest chip hub in a series

of X posts over the weekend, rejecting criticism that it favours

a liberal stronghold. He framed it instead as a "national

survival strategy" to ease regional imbalances and expand

capacity for the AI era.

"The creation of a semiconductor industrial ecosystem in

(the southwest) is not a special favour for a particular

region," Lee wrote in one post.

"It is the additional creation of the most rational

semiconductor industrial centre through the decisions of

relevant companies under full government support."

Industry experts say diversifying chip investment beyond

Seoul could ease infrastructure bottlenecks, but warn that

building cutting-edge fabs requires vast electricity and water,

advanced logistics, deep supplier networks and highly skilled

labour - elements that may not scale quickly enough in a new

region to meet surging AI demand.

Opposition politicians have sharply criticised the plan,

questioning whether the proposal is politically motivated given

that 85% of voters in the region backed Lee in last year's

presidential election.

The announcement comes as Lee's approval rating has slid for

six weeks to 46.5%, according to pollster Realmeter.

($1 = 1,535.1300 won)