Japan launches plan to revitalise semiconductor industry

Japan is making a bold push to reclaim its position as a global leader in semiconductor production with the launch of Rapidus, a state-backed chip venture that represents the country’s “last opportunity” to catch up with dominant players like Taiwan and South Korea.

Prime Minister Shigeru Ishiba announced that the plan will allocate over 10 trillion yen ($65 billion) in support by fiscal 2030, Caliber.Az reports via foreign media.

“We will formulate a new assistance framework to attract more than 50 trillion yen in public and private investment over the next 10 years,” Ishiba stated, emphasising that this would be part of broader "revitalisation" efforts for Japan’s economy. The proposal is part of a comprehensive economic package set to be finalised in November, with funding to come from subsidies, government investments, and debt guarantees. This move is part of Japan’s wider strategy to strengthen and diversify its semiconductor supply chain, with the government aiming to triple the sales of domestically produced chips to more than 15 trillion yen by 2030. 

A key beneficiary of the funding could be Rapidus, a Japan-based semiconductor venture backed by the state and central to the nation’s chip revival strategy. Founded in 2022, Rapidus has received support from major Japanese companies such as Toyota and Sony, and is collaborating with US tech leader IBM. The company has already secured over $2 billion in government backing as it works towards mass-producing advanced 2-nanometer logic chips by 2027. These chips, essential for processing data and executing tasks in electronic devices, are particularly crucial for technologies like artificial intelligence, quantum computing, and machine learning.

Rapidus chairman Tetsuro Higashi has reportedly described the company as Japan’s "last opportunity" to reclaim a leading position in the global semiconductor market as it works to close the gap with industry giants like Taiwan and South Korea. In the 1980s, Japan dominated the global semiconductor market, controlling more than half of the market share. However, the country began losing ground with the rise of foreign competitors such as Taiwan Semiconductor Manufacturing Co. (TSMC), now the world’s largest contract chipmaker, and South Korea’s Samsung. Both Samsung and TSMC have announced plans to begin commercial production of 2-nanometer chips by 2025. Meanwhile, the U.S. has solidified its role in chip design with companies like Intel and Micron, and the Netherlands is a leader in advanced chipmaking equipment through ASML, its key player in the industry. 

By Naila Huseynova