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Kishida Meets Chipmakers to Bring More Production to Japan

Kishida Meets Chipmakers to Bring More Production to Japan

(Bloomberg) -- Prime Minister Fumio Kishida met with the heads of the world’s largest chipmakers on Thursday in Japan’s latest move to boost its domestic semiconductor sector amid a global rethink of economic security.

Executives from Micron Technology Inc. to Taiwan Semiconductor Manufacturing Co. told Kishida they would consider investing further in Japan, depending on the financial incentives offered and customer demand, according to Minister of Economy, Trade and Industry Yasutoshi Nishimura.

Intel Corp. chief Patrick Gelsinger and TSMC Chairman Mark Liu attended the meeting along with executives of Micron, Samsung Electronics Co., IBM and chip gear maker Applied Materials Inc.

The country’s deep manufacturing base spanning chemicals to chip gear is a large draw for chipmakers, Nishimura told reporters after the meeting. “Japan has great potential when it comes to the semiconductor industry,” he said.

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The country is pushing to bring more advanced chipmaking home as growing US-China tensions spur concerns about reliance on Taiwan, which China claims as its own. But while Japanese companies continue to control key steps in the chip supply chain, the country’s efforts have fallen far short of subsidies offered by the US.

The Japanese government plans to provide financial support for Micron’s plan to invest as much as ¥500 billion ($3.6 billion) to fabricate next-generation memory chips at its existing DRAM facility in Hiroshima. Nishimura declined to specify an amount. Micron is expected to get about $1.5 billion from Japan, Bloomberg reported earlier.

Micron’s investment would help it install advanced EUV chipmaking equipment from ASML Holding NV to fabricate what the US memory maker calls one-gamma production, a more advanced technology planned for launch in late 2024.

“The breakthrough one-gamma partnership between Micron and Japan will enhance our two countries’ competitiveness and make our semiconductor supply chain less vulnerable to disruption and economic coercion,” said US Ambassador to Japan Rahm Emanuel in an emailed statement.

Kishida’s meeting took place just before the convening of the Group of Seven summit in Hiroshima. The agenda includes shoring up and diversifying global supply chains, as the world’s richest economies seek to build tech self-sufficiency and reduce dependence on China.

Intel is looking to partner with local materials makers to promote sustainable development, while IBM is looking for opportunities to cooperate in quantum computing, Nishimura said. Samsung is considering building a research site in Japan to explore cutting-edge packaging technologies, officials added.

Japan’s government is already spending billions of dollars to encourage TSMC to add production capacity in the country, and to finance its own chip venture Rapidus Corp., with aspirations to make 2-nanometer chips by 2027. The Micron deal will bring Netherlands’ EUV equipment to Japan for the first time, a step toward leading-edge manufacturing the government has sought.

The world’s third-largest economy is aging rapidly, giving rise to new chip and AI applications to meet demand in pharmaceuticals and life sciences, said Masoud Mirgoli, an executive vice president at Belgian nanoelectronics and digital tech developer imec. His organization also plans to build a research site in Japan and work with Rapidus, Mirgoli said. Every single Group of Seven nation needs a plan for semiconductors, he said.

--With assistance from Takahiko Hyuga, Paul Jackson and Vlad Savov.

(Updates with US ambassador comment and details throughout)

More stories like this are available on bloomberg.com

©2023 Bloomberg L.P.