The panorama: Japan’s share of world semiconductor sales has dropped from 50 percent in 1988 to less than 10 percent today. The country has more chip factories than any other country, 84 to be exact, but only a few of them use advanced process nodes under 10nm. That is why the country is struggling to revive its semiconductor industry, even if it comes at an incredibly high cost for the next decade.
The constant shortage of chips has affected everything from LCD screens to graphics cards, game consoles, televisions, and even automakers. For consumers, this has created a hostile shopping environment in some cases, while some governments have become acutely aware of the fragility of the global technology supply chain.
In the US, the Biden administration is trying to fix the situation by committing $ 52 billion to boost the local semiconductor industry, heeding the call from the Silicon Industry Association but at the same time falling short of $ 100,000. millions in which China is investing. government subsidies for semiconductor companies.
The European Union is also looking to double chip manufacturing as part of its “Digital compass“Initiative, which is aimed at increasing the region’s share of global semiconductor manufacturing to 20 percent by 2030. It is too ambitious a goal, but Intel has promised to build a chip factory in Europe, while Apple will invest $ 1.2 billion at a silicon design center in Germany that will focus on 5G and other wireless connectivity technologies.
Meanwhile, in Japan, Prime Minister Yoshihide Suga revealed His country has made it a priority to prevent the local semiconductor industry from falling apart and to help it regain its strength when it comes to advanced manufacturing processes. An interesting but little known fact is that Japan has no fewer than 84 semiconductor plants, more than any other country and about eight times more than Taiwan, or four times more than South Korea.
The main problem with these plants is that most of them are using old, outdated equipment, some of which was offloaded earlier this year to Chinese companies who were more than happy to buy it to circumvent US restrictions. The only notable exceptions are Sony and Kioxia, which are known for their advanced camera sensors and flash memory, respectively.
Although one would think that Japan’s goal is to increase its semiconductor production at all costs, the country’s plan has more to do with “national security.” Specifically, it wants to create an attractive environment for companies like TSMC to build local foundries and research and development centers, with the ultimate goal of opening an independent path to infuse their infrastructure with future technologies.
Clearly, this strategy stems from simple observations about how global tensions and the race to achieve technological dominance have affected the global technology supply chain, and have also led to a step back in the globalization of the electronics industry. chips.
On top of that, Japan went from dominating global semiconductor sales in 1988 to importing 64 percent of the chips needed for its local industry last year.
Japan also wants to implement stricter export controls for the chips, as well as the materials needed to make them, especially since they are seen as a sensitive industry that allows the manufacture of equipment for civilian and military use.
However, the big question is what it will take for Japan to achieve this goal. According to Tetsuro Higashi, who is the former chairman of Tokyo Electron, the initial investment is at least one trillion yen ($ 9 billion), with trillions more in the next ten years. The 71-year-old silicon industry veteran says a combination of subsidies, tax breaks and a new framework will also be needed to facilitate technology sharing.