For reasons of economic security, Japan produces electronic chips locally | leadership

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Current chip shortages and supply chain disruptions have cut production from major Japanese automakers such as Toyota and Honda this year, underscoring the need to reduce the country’s reliance on outside sources for advanced semiconductors.

Therefore, Japanese Prime Minister Fumio Kishida allocated funds to revive the electronic chip industry locally, according to the “Bloomberg” news agency.

Bloomberg reported that the Japanese government plans to provide half of the funds, amounting to about 800 billion yen (7 billion dollars) for a new plant that the “Taiwan Semiconductor Industry” and “Sony” plan to build in the city of Kumamoto in western Japan.

It was reported that the plant will start operating by 2023 or 2024, and it will produce chips used in camera sensors, chips used in cars and other products.

Japanese Prime Minister Fumio Kishida has allocated funds to revive the domestic chip industry.Japanese Prime Minister Fumio Kishida has allocated funds to revive the domestic chip industry (Reuters)

In response to a question about this development, Kishida said – to TV Tokyo this week – that the government will allocate funding in the next economic stimulus package scheduled by the end of the year.

“This is a very important step, from the point of view of economic security,” said Kishida, who took office this month and created a new economic security ministerial post. “Semiconductors are an important product for our nation,” he added.

It is noteworthy that US Commerce Secretary Gina Raimondo said – this month while discussing President Joe Biden’s plan to modernize infrastructure in the Senate – that the United States is facing a national security crisis due to the lack of semiconductor production. The official urged Congress to invest heavily to dramatically increase US production of semiconductors.

The Japanese government intends to provide half of the funds amounting to about 7 billion dollars for the construction of a new factory for the manufacture of semiconductors.

The plan proposed by President Biden to develop infrastructure with spending of $ 2.25 trillion includes allocating $ 50 billion to the National Science Foundation to create a technology body focused on semiconductor manufacturing, among other things.

The world’s major semiconductor producers are TSMC in Taiwan, and in South Korea, Samsung and SKhynix. As for the United States, there is a major producer, “Intel” (Intel).

Many other industrial sectors – including smartphones and electronic games – have been facing difficulties for several months in supplying semiconductors. It is noteworthy that the crisis of lack of electronic chips prompted most of the car manufacturers in the world to reduce their production.

Semiconductors include materials, the most famous of which is silicon, which allows electronic devices to capture, process and store data.

These components are essential to entire parts of global industry, and they make up many of the tools we use on a daily basis. We find it in electronic devices such as smartphones, computers, video game players, cars, especially control panels, aircraft, information and telephone networks, and others.

The semiconductor market has been under pressure from the US-China trade war, and major companies such as Huawei last year stockpiled large quantities to reduce the impact of sanctions.

The European Union aims to produce 20% of the world’s semiconductors by 2030, which is double its current production share.

As needs surged, major manufacturers doubled down on announcing investments to boost their production capabilities. In this context, Intel plans to invest $20 billion, while TCMC will invest $100 billion.

In order to ensure its technological supremacy in the face of China and the United States in this market estimated at 440 billion euros, the European Union also aims to produce 20% of the world’s semiconductors by 2030, which is equal to twice its current share of production. The United States and the European Union also agreed to support this sector in particular during meetings in Pittsburgh, which were aimed at strengthening trade relations that were damaged during the administration of former President Donald Trump, and at cooperation in the technology sector. The two parties said they agreed to make joint efforts to “rebalance global semiconductor supply chains, with a view to enhancing security of supply” and to activate local chip production capabilities.

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