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4 April 2022

Japan prioritises semiconductor industry in bid to enhance economic security

Mariko Togashi

The world’s semiconductor race is accelerating. Used in every electronic appliance essential to our daily lives, semiconductors are critical to national security. Driven by competition between the United States and China, as well as a global chip supply shortage and supply-chain disruptions, governments around the world are pursuing aggressive funding measures to secure access to semiconductors. Japan is no exception – strengthening semiconductor supply chains is a key element of its latest economic security bill.

The US is in the final phase of passing the CHIPS Act, which will provide US$52 billion to subsidise semiconductor manufacturing. Following the US, in February 2022, the European Commission announced the Chips Act package, a €43bn investment plan to increase its market share of global production from 10 to 20% by 2030. South Korea is also seeking to pass legislation that would provide US$450bn in investment in semiconductor production over ten years.

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