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Micron reveals $3.6 bn Japan chip plan after PM meets execs

Japan, like many developed nations, is worried about the fragility of existing global semiconductor supply chains
Japan, like many developed nations, is worried about the fragility of existing global semiconductor supply chains - Copyright AFP/File Yuichi YAMAZAKI
Japan, like many developed nations, is worried about the fragility of existing global semiconductor supply chains - Copyright AFP/File Yuichi YAMAZAKI

Micron said Thursday it will invest $3.6 billion to produce next-generation semiconductors in Japan, after Prime Minister Fumio Kishida held talks with some of the world’s biggest chipmakers.

Kishida is trying to boost the domestic chip industry, after the weaknesses in global semiconductor supply chains were exposed by developments including the pandemic and the ongoing US-China tussle over advanced tech.

Attendees at the Kishida meeting on Thursday included senior executives from Taiwan’s TSMC, South Korean giant Samsung, and US titans Intel, Micron and IBM.

“Micron expects to invest up to 500 billion yen ($3.6 billion) in 1-gamma process technology over the next few years, with close support from the Japanese government,” the firm said in a statement, referring to the production of advanced DRAM memory chips.

The investment would “enable the next wave of end-to-end technology innovation such as rapidly emerging generative artificial intelligence (AI) applications”.

Micron added that it would be the first firm to bring extreme ultraviolet (EUV) chip-making to Japan.

It described the tech as the “most sophisticated semiconductor manufacturing process in the world”.

There was no immediate confirmation of what assistance Japan might offer, though Bloomberg News earlier reported Kishida was set to hand Micron $1.5 billion in incentives.

Japan has already agreed to pour half a billion dollars into a new project to develop and make next-gen chips domestically.

That deal involves eight major companies, including Sony, SoftBank and Toyota, who are partnering in a new firm called Rapidus that hopes to begin mass production by 2027.

TSMC and Sony have also inked their own partnership for a $7 billion plant in Japan.

Last month, Europe too announced plans to ramp up local chip production, with the goal of doubling its current global market share to 20 percent by 2030.

– ‘Economic coercion’ –

Chips are the lifeblood of the modern global economy, powering everything from cars to smartphones, and they are forecast to become a $1 trillion industry globally by 2030.

Much of the world’s semiconductor manufacturing is based in Taiwan.

Fears have grown about the impact of any Chinese military action to seize the self-ruled island, which it claims as its territory.

The chip industry moves by Japan and Europe come as the United States and China lock horns over access to advanced semiconductors.

Washington has in recent years sought to prevent advanced US chip tech from being exported to China, citing national security concerns.

Japan and the Netherlands recently announced their own export restrictions on chip items, without naming China.

Still, Beijing reacted angrily, and has called for a World Trade Organization review of the measures.

Last month, Chinese authorities also announced an investigation into Micron, which they said was intended to “safeguard national security”.

Kishida’s meeting with chip firms came a day before he hosts G7 leaders for a summit in the city of Hiroshima.

G7 leaders are expected to call for “de-risking” of crucial supply chains, and to warn of the risks of “economic coercion” by China.

AFP
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With 2,400 staff representing 100 different nationalities, AFP covers the world as a leading global news agency. AFP provides fast, comprehensive and verified coverage of the issues affecting our daily lives.

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