Govt to Offer ¥730 bil. in Aid for Construction of TSMC’s 2nd Plant in Japan’s Kumamoto Prefecture

The Yomiuri Shimbun

14:37 JST, February 23, 2024

The government intends to provide a subsidy of about ¥730 billion for the construction of Taiwan-based chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC)’s second plant in Kumamoto Prefecture.

The government had already decided to offer up to ¥476 billion in aid for the construction of the company’s first plant. Through the huge amount of financial assistance, Japan aims to boost the domestic production of semiconductors.

The construction of the second plant will start by the end of this year. The new plant is expected to produce 6- to 7-nanometer semiconductors. A nanometer is one-billionth of a meter.

Along with the first TSMC plant, which will hold its opening ceremony Saturday, the total amount of funds invested in the company’s facilities exceeds 20 billion dollars (about ¥3 trillion) while over 3,400 people are expected to be hired for these plants.

The finer the line width of a circuit, the higher the processing ability of the semiconductor. Semiconductor plants that currently exist in Japan are said to be incapable of producing semiconductors with thinner than 40-nanometer line widths. For that reason, Japan depends on imports for advanced semiconductors. The government is likely to ask TSMC to secure continued production of semiconductors and increase production for domestic use in case there is a semiconductor supply shortage.

The government hopes the construction of the second TSMC plant will help strengthen the domestic production base for semiconductors and revitalize the entire industry in Japan.