In a strategic move to bolster its technological competitiveness, Japan has unveiled a plan to invest 2 trillion yen (approximately $13 billion) into the development of semiconductor production and generative AI technology. The announcement is part of a broader economic stimulus package aimed at enhancing Japan's position in the global tech landscape amid ongoing supply chain disruptions and geopolitical tensions.
The investment includes significant funding for semiconductor ventures, with Taiwan Semiconductor Manufacturing Company (TSMC) receiving 770 billion yen (around $4.6 billion) to establish its second chip fabrication plant in Kumamoto prefecture. This facility is expected to commence construction in April 2024 and begin producing 12nm chips by 2026. The first TSMC fab in the region, which comes with a price tag of US$8.6 billion, will receive a subsidy of US$3.5 billion from Japan's Ministry of Economy, Trade and Industry (METI) and is scheduled to start operations by December 2024.
Additionally, Japan's trade ministry official Motoki Kurita highlighted the allocation of 650 billion yen (USD 4.3 billion) to Rapidus for next-generation microchip development, as well as a proposed 460 billion yen for a new PSMC facility in Miyagi prefecture. The remaining funds from the investment are earmarked for supercomputer development.
This initiative represents a significant push by Japan to reassert itself in the critical field of semiconductor manufacturing—a sector that has seen supply chain vulnerabilities exposed during the pandemic and rising tensions with China. The investment also underscores the importance of generative AI technologies as a future cornerstone of industry and innovation.
The sweeping measures come as part of Japan's larger USD 100 billion stimulus package, which was approved by the cabinet and aims to revitalize an economy challenged by external pressures and internal needs for technological advancement. With these investments, Japan seeks not only to secure its own supply chains but also to contribute more substantially to the global semiconductor market.
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