Japanese Prime Minister Shigeru Ishiba pledged more than US$64.9 billion of fresh support for the nation’s semiconductor and artificial intelligence (AI) sector as Tokyo seeks to keep up with a global spending spree on cutting-edge technology.
Ishiba said he hoped public aid of more than ¥10 trillion (US$64.91 billion) for the sector by fiscal 2030 would serve as a catalyst to generate public and private investment of more than ¥50 trillion over the next 10 years.
The new funding framework, separate from previously earmarked funds of about ¥4 trillion, would be sketched out in an upcoming economic stimulus package with an aim to generate an economic impact of about ¥160 trillion, a draft of the package seen by Bloomberg showed.
Photo: Bloomberg
The additional funding would help Tokyo narrow the gap with global powers on chip support. The US and its allies are racing to keep ahead of China in AI-powering semiconductor capabilities, a domain that policymakers view as essential for economic security.
Tokyo’s ramping up of support for the sector is also based on the need to fuel economic growth at the national and regional levels.
Speaking at a news briefing on Monday after winning a vote in parliament to remain prime minister, Ishiba said he wanted to spread positive examples of regional revitalization such as Taiwan Semiconductor Manufacturing Co’s (TSMC, 台積電) chip plant in Kumamoto Prefecture across the nation.
Global chip demand is expected to triple to ¥150 trillion over the next 10 years, and the framework aims to provide public aid of more than ¥10 trillion through methods including outsourcing, financial support and legislative measures to boost predictability for private companies, according to the draft.
A previous goal of reaching ¥10 trillion in chip-sector investment set by former Japanese prime minister Fumio Kishida relied on private sector support in addition to public money.
Under Kishida, Japan already earmarked about ¥4 trillion in extra budgets to revive its chip sector, including ¥920 billion for Rapidus Corp in Hokkaido. Rapidus aims to mass produce advanced logic chips by 2027.
The new framework would be separate from the ¥4 trillion, Japanese Minister of Economy, Trade and Industry Yoji Muto said yesterday.
“Chips are not limited to Rapidus,” Muto said. “The process will be about considering how we will approach the next-generation semiconductor market from now on.”
The government would not raise taxes to fund the new framework, Muto said, adding that details are still being hammered out.
Ishiba said he would discuss the funding of the plans with ministries, but he would not pay for the measures through deficit-financing bonds.
Earlier local media reports suggested the government was looking for a new way of providing funding for Japan’s semiconductor sector. Ishiba’s government is planning to issue bonds backed by assets it holds, including NTT Corp shares, to provide subsidies to semiconductor companies, the Nikkei reported on Nov. 1.
‘SWASTICAR’: Tesla CEO Elon Musk’s close association with Donald Trump has prompted opponents to brand him a ‘Nazi’ and resulted in a dramatic drop in sales Demonstrators descended on Tesla Inc dealerships across the US, and in Europe and Canada on Saturday to protest company chief Elon Musk, who has amassed extraordinary power as a top adviser to US President Donald Trump. Waving signs with messages such as “Musk is stealing our money” and “Reclaim our country,” the protests largely took place peacefully following fiery episodes of vandalism on Tesla vehicles, dealerships and other facilities in recent weeks that US officials have denounced as terrorism. Hundreds rallied on Saturday outside the Tesla dealership in Manhattan. Some blasted Musk, the world’s richest man, while others demanded the shuttering of his
TIGHT-LIPPED: UMC said it had no merger plans at the moment, after Nikkei Asia reported that the firm and GlobalFoundries were considering restarting merger talks United Microelectronics Corp (UMC, 聯電), the world’s No. 4 contract chipmaker, yesterday launched a new US$5 billion 12-inch chip factory in Singapore as part of its latest effort to diversify its manufacturing footprint amid growing geopolitical risks. The new factory, adjacent to UMC’s existing Singapore fab in the Pasir Res Wafer Fab Park, is scheduled to enter volume production next year, utilizing mature 22-nanometer and 28-nanometer process technologies, UMC said in a statement. The company plans to invest US$5 billion during the first phase of the new fab, which would have an installed capacity of 30,000 12-inch wafers per month, it said. The
MULTIFACETED: A task force has analyzed possible scenarios and created responses to assist domestic industries in dealing with US tariffs, the economics minister said The Executive Yuan is tomorrow to announce countermeasures to US President Donald Trump’s planned reciprocal tariffs, although the details of the plan would not be made public until Monday next week, Minister of Economic Affairs J.W. Kuo (郭智輝) said yesterday. The Cabinet established an economic and trade task force in November last year to deal with US trade and tariff related issues, Kuo told reporters outside the legislature in Taipei. The task force has been analyzing and evaluating all kinds of scenarios to identify suitable responses and determine how best to assist domestic industries in managing the effects of Trump’s tariffs, he
Taiwan’s official purchasing managers’ index (PMI) last month rose 0.2 percentage points to 54.2, in a second consecutive month of expansion, thanks to front-loading demand intended to avoid potential US tariff hikes, the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday. While short-term demand appeared robust, uncertainties rose due to US President Donald Trump’s unpredictable trade policy, CIER president Lien Hsien-ming (連賢明) told a news conference in Taipei. Taiwan’s economy this year would be characterized by high-level fluctuations and the volatility would be wilder than most expect, Lien said Demand for electronics, particularly semiconductors, continues to benefit from US technology giants’ effort