An official from Japan’s Ministry of Commerce announced that the government is willing to provide financial assistance if Taiwanese chip manufacturing giant TSMC decides to set up a second manufacturing facility in Japan.
Hisashi Kanazashi, Director of Information Technology at the Ministry of Commerce of Japan, said that if chip manufacturing giant TSMC decides to open a second state-of-the-art chip manufacturing factory in the country, the Japanese government is willing to provide financial assistance to this investment.
Kanazashi stated that Tokyo is ready to provide the necessary funds to help finance a facility that TSMC is considering establishing in southern Japan.
Both parties spent months determining subsidies for the second facility, which is projected to be built adjacent to the TSMC factory currently being built near the business partner Sony Group owns complex in Kumamoto.
The official declined to elaborate on how much the Tokyo government could allocate to the chipmaker for the investment, which is key to fulfilling the country’s desire to regain its status as a global chip manufacturing power.
“We will observe the budget balance in the incentives offered”
Speaking at an industry conference in Kumamoto, Kanazashi said, “We see the current global geopolitical situation as a chance to revive the local chip industry. In addition, we will try to maintain the budget balance in the negotiations with TSMC.
TSMC is building facilities in Japan and the US to address national security concerns regarding the concentration of primary chip manufacturing facilities in Taiwan, a geopolitical hotspot vulnerable to supply chain shocks due to US and China tensions.
The Taiwanese chip manufacturing giant previously announced that the Tokyo administration expects the Kumamoto factory to cover half of the cost. The first plant is expected to be commissioned next year.
TSMC executives announced in June that talks on subsidies for a second project alone are ongoing. The top management of the chip manufacturing giant met with Japanese President Fumio Kishida before the G-7 summit in Hiroshima in May.
Germany and the EU announced many incentives
Recently, many countries have been trying to persuade chip production giants to invest in their own lands by announcing great incentives.
Germany had previously started negotiations with Intel and announced that it would support 6.8 billion euros for the investment, which was calculated to cost 17 billion euros in the first place.
However, after the investment cost increased to 30 billion euros due to the turmoil in the economy, the two sides reunited and the supports were changed to include energy price ceilings as well as traditional aid. With the changes made, the subsidy figure is estimated to reach 10 billion euros.
Ursula von der Leyen, President of the European Union (EU) Commission, also said that they attracted more than 90 billion euros in investment in the chip industry thanks to the chip production support law they prepared last year.
Von der Leyen, stating that they want to make Europe a leader in global semiconductor research, design, testing and production with the chip law, said, “The chip law will be officially enacted this autumn, but chip investments are already gaining incredible momentum. The chip law was proposed in February last year. More than 90 billion euros of industrial investment in the chip field have been announced across Europe since we launched it,” said.