Japan will allocate an additional 1.5 trillion yen (9.9 billion dollars) to promote its semiconductor and ai business, including funds for the chip foundry Rapidus.
It is reported by China Finance APP that Japan will allocate an additional 1.5 trillion yen (9.9 billion dollars) to promote its semiconductor and ai business, including funds for the chip foundry Rapidus.
In the fiscal year ending in March, the Japanese government allocated an additional 1.05 trillion yen for the development and research of next-generation semiconductors and quantum computing related fields. In addition, 471.4 billion yen was allocated to support domestic advanced chip production. According to the Ministry of Economy, Trade and Industry, it has not yet been decided how much will be allocated to Rapidus.
Japan is one of the world's largest semiconductor materials and equipment manufacturers, striving to keep up with the global technology investment craze led by China and the USA. Policymakers believe that chips are crucial for developing outstanding ai and national security.
This additional budget allocation is part of Prime Minister Shiwa Shigenobu's commitment to provide over 100 trillion yen in new support for semiconductors and ai by the fiscal year 2030. Shiwa Shigenobu and cabinet members stated that domestic semiconductor production is crucial for Japan's economic security. This additional budget was approved by the Japanese cabinet on Friday and is expected to be passed in parliament by the end of the year.
Over the past three years, the Japanese government has allocated about 4 trillion yen for chip-related support, investing billions of dollars in expanding Taiwan Semiconductor's factory in Kumamoto, Japan, and Micron Technology's factory in Hiroshima to produce advanced DRAM including high-bandwidth memory internally. The government also allocated about 920 billion yen for Rapidus factory in Hokkaido.
Rapidus is attempting to develop cutting-edge chip manufacturing capabilities from scratch and currently heavily relies on public support. The company's goal is to achieve mass production by 2027.
Additionally, the Ministry of Economy, Trade and Industry has approved a total subsidy of 101.7 billion yen from last year's additional budget to support the country's dispersed high-tech supply chain. Of this, as much as 70.5 billion yen will be used to support joint investments of 212 billion yen by Denso Corporation and Fuji Electric Co., Ltd. to enhance the production of silicon carbide wafers and power chips for use in electric autos.
Last year, the Ministry of Economy, Trade and Industry approved subsidies to Toshiba Corporation and Rohm Corporation, both of which are collaborating to produce power semiconductors.