Japan’s Economy Ministry to Support Country’s Chip Sector

The Ministry of Economy, Trade and Industry of Japan is currently preparing subsidies intended for the implementation of measures to develop the chip manufacturing sector of this country.

Japan’s Economy Ministry to Support Country’s Chip Sector

The specified ministry intends to allocate funds for 2 trillion yen ($13 billion) for the mentioned purposes. Japan is currently making efforts to invest in sphere manufacturing microcircuits. The country is striving to regain its status as the largest semiconductor power.

The mentioned funds will be allocated as part of the supplementary budget for the current fiscal year. As part of a long-term effort to secure financing for the development of the chips sphere, Tokyo plans to issue bonds worth almost 9 trillion yen. This plan raises concerns related to the country’s growing debt.

Currently, the Ministry of Economy, Trade and Industry of Japan is looking for funds for 1.85 trillion yen in addition to the money not yet spent on subsidies. This week, the media reported that the said country plans to finance an increase in chip production capacity. Japan also intends to take measures to secure microcircuits at home.

A broader strategy to revitalize the economic system of this country provides for raising investment funds to develop the production of advanced chips, the use of which is crucial in new generation technologies, including, for example, artificial intelligence and cars equipped with autopilot systems. As part of the relevant efforts, the Japanese leadership plans to spend billions of dollars to support Taiwan Semiconductor Manufacturing Co. (TSMC), which is a leader in making the most modern chips. Tokyo will also financially support Rapidus Corp., a local startup that has ambitions to occupy its niche in the sphere of manufacturing high-quality microcircuits.

The funds allocated by the state will be used to expand Japan’s capabilities in developing and producing chips of a new generation. Also in this case, the country pursues the goal of creating the infrastructure necessary for the implementation of activities for the training of artificial intelligence models.

Tokyo provides financing for manufacturers of high-quality components of microchip equipment, industrial gasses, and semiconductors. State financial support for the process of training engineers is also provided.

A representative of the Ministry of Economy, Trade and Industry of Japan during a press briefing said that the global security situation in sphere semiconductors is becoming more complicated, noting the great interest on the part of foreign and local companies to invest in the technology sector of this country.

Tokyo in this case acts rationally and expediently, since its production of chips in the conditions of new realities, in which artificial intelligence is gradually moving towards becoming something like the main force for changing the world relative to its current state, is a serious advantage, including political significance. Moreover, Japan, in a sense, is trying to take revenge, seeking to regain its technological greatness, which for several decades existed in a kind of gradual decline format.

Currently, a TSMC plant is under construction in Kumamoto Prefecture, located on the island of Kyushu. Tokyo is taking on almost half of the costs associated with the implementation of this project, while simultaneously participating in negotiations to support the second factory. Also, the Japanese government is ready to allocate about $1.5 billion to finance the expansion of the Micron Technology Inc. plant in the city of Hiroshima, located in the southwest of Honshu Island.

Tokyo also provides monetary support for Rapidus’ attempts to launch the production of advanced 2-nanometer chips. This company is making long-term efforts to establish a Japanese manufacturing microcircuits plant. The firm is ready to compete with such major chip-making industry players as TSMC and Samsung Electronics Co. Tetsuro Higashi, chairman of the management board of the company, said that Rapidus will build an ultra-modern foundry by 2027, separately noting that this facility will contribute to achieving the ambitious goal of strengthening the Japanese economy by ensuring stable supplies.

As we have reported earlier, SoftBank Teams Up With Nvidia to Create Advanced AI Data Centres in Japan.

Serhii Mikhailov

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Serhii’s track record of study and work spans six years at the Faculty of Philology and eight years in the media, during which he has developed a deep understanding of various aspects of the industry and honed his writing skills; his areas of expertise include fintech, payments, cryptocurrency, and financial services, and he is constantly keeping a close eye on the latest developments and innovations in these fields, as he believes that they will have a significant impact on the future direction of the economy as a whole.