Japan boosts semiconductor push to shield global supply chains: Here’s why

Japan’s Ministry of Economy, Trade and Industry approved an additional 631.5 billion yen ($3.96 billion) on Saturday to accelerate research and development at chipmaker Rapidus. This is a part of a broader government strategy to boost domestic production of advanced semiconductors and secure chip supply chains. Additionally, the New Energy and Industrial Technology Development Organization (NEDO) has decided to support semiconductor design projects by Fujitsu and IBM Japan.

According to Reuters, the recent shift underscores broader efforts to build a complete domestic semiconductor ecosystem, spanning from design to manufacturing. Rapidus has already secured approximately an additional 160 billion yen from private investors, with an additional 250 billion yen in government planned. This new capital aligns with Japan’s initiative to reduce reliance on foreign suppliers and secure its supply chains.

Japan’s Rapidus investment: What this move signals

The primary motive behind this initiative is to foster technological independence amidst growing competition among global chip leaders. This investment will ultimately sharpen the focus on next-generation chip innovation. As the global race for smaller, faster, and more efficient components intensifies, Rapidus is positioning itself as a central player in semiconductor manufacturing. The company is currently developing next-generation 2-nanometre logic chips, with plans to begin mass production in fiscal year 2027.