Japan to Launch 10 Trillion Yen Plan to Support Chip and AI Development

On November 11, Japanese Prime Minister Shigeru Ishiba announced a plan for the Japanese government to provide at least 10 trillion yen (approximately $65 billion) by fiscal year 2030 to support the semiconductor and artificial intelligence industries.

In a press conference, Ishiba stated that a new assistance framework has been established to attract more than 50 trillion yen in public and private investment over the next decade, which will be incorporated into the comprehensive economic plan finalized in November. One of the beneficiaries will be Rapidus, a state-supported initiative for mass-producing advanced chips.

The assistance will take the form of subsidies, investments by government-affiliated institutions, and debt guarantees for loans provided by private financial groups. Ishiba emphasized that Japan will not issue deficit government bonds to fund this plan.

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The Japanese government will introduce a framework to strengthen the AI and semiconductor industry foundation, with a vision extending to fiscal year 2030. It is expected to bring an overall economic impact of 160 trillion yen. According to a report by Nikkei, relevant departments and institutions are preparing legislation to provide debt guarantees and investments for Rapidus, with the goal of submitting a proposal to the National Diet by 2025.

The Japanese government believes that establishing advanced semiconductors is essential for economic security. Due to the low predictability of single-year, single-payment subsidies, the government has adjusted its approach to provide multi-year assistance.

Rapidus is expected to begin mass production of new chips in 2027, with the Japanese government providing comprehensive support. The government has already granted 920 billion yen, and the Rapidus project will need 5 trillion yen to achieve mass production.