Japan prepares 2 trillion yen to support country’s chip sector
JAPAN’S Ministry of Economy, Trade and Industry (Meti) is preparing a total of two trillion yen (S$18 billion) in subsidies to drive investment in its chip industry, in a bid to regain its status as a major semiconductor power.
Meti is seeking the sum in an extra budget, on top of as-yet-unspent money for chip-related subsidies. Bloomberg earlier reported that Japan was planning to allocate money to boost capacity to make and secure chips at home.
As part of a broader blueprint to revive the economy, Tokyo is trying to entice investment in the production of cutting-edge semiconductors critical to future technologies from artificial intelligence (AI) to self-driving cars. That includes billions of dollars to support Taiwan Semiconductor Manufacturing Company (TSMC), the industry leader in advanced chip production, and for Rapidus, a Japanese startup that aims to compete in high-end chip production.
The money will be used to speed up Japan’s ability to design and manufacture next-generation chips and train AI models. Japan is setting aside funds for makers of high-end components, chip gear, industrial gases and semiconductor manufacturing, as well as for training engineers.
“The global economic security situation over semiconductors is becoming more severe,” a Meti official told reporters at a news briefing. “We are receiving a lot of interest both from foreign and domestic companies who want to invest in Japan.”
Japan is trying to reclaim leadership in the chip industry after decades of eroding prominence. It is shouldering almost half the cost of TSMC’s Kumamoto factory, and it is in talks about support for a second plant. The country is also poised to provide about US$1.5 billion to help finance an expansion at Micron Technology’s Hiroshima factory; in addition, it is bankrolling Rapidus’ attempt to make the country’s own cutting-edge two-nanometre chips.
Rapidus is taking on a long-shot effort to build a Japanese chip foundry that can compete with the likes of TSMC and Samsung Electronics. Tetsuro Higashi, the company’s chairman and an industry veteran, said the state-backed firm aims to build a cutting-edge foundry by 2027, with the goal of fortifying Japan’s economy by ensuring steady supplies.
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