Chip Czar says Japan will support Rapidus, even if targets are delayed

Japan’s support for Rapidus will not waver even if the government-backed company has to postpone its target of mass production of advanced logic chips until 2027, the chairman of the ruling party’s semiconductor group said.

Citing feedback he has received from company and government officials, the LDP’s Daishiro Yamaki said Rapidus is on track to launch a pilot production line for its products in April 2025, on track to achieve mass production targets.

“We are firmly executing on our semiconductor strategy, and the Rapdius project is a core part of that strategy,” Yamagiwa said in an interview with Bloomberg News on Tuesday. Even if the target is changed from 2027 to 2028, “it doesn’t matter to us,” he said.

Japan is entering into a multi-billion-dollar joint venture with Rapidus to develop domestic manufacturers of next-generation semiconductors. The startup, which is backed by local industry leaders including Toyota Motor Corp and Sony Group Corp, aims to launch 2-nanometer chips within three years. It’s an ambitious plan to catch up with leaders TSMC and Samsung Electronics, both of which aim to start mass production of their 2nm process next year.

Samwa said he is fully aware of the risks associated with the ambitious project and has ongoing concerns about its fate given that past government efforts to help the private sector have failed to revive the chip-making capabilities the country was once known for.

“We will keep trying until we succeed, that is the only way we can survive,” the 56-year-old said. “This is a battle for our nation’s survival.”

Yamagiwa said the party aims to successfully pass legislation in next year’s parliamentary session that would enable the government to increase funding for chipmakers including Rapidus in new ways.

“I don’t foresee any opposition to this,” the former economic revitalization secretary said, adding that chipmaking technology was vital to national security and the economy and that the government’s new efforts were already helping some regional economies.

The LDP and its junior partner Komeito need support from the opposition after losing their majority in October elections. In November, Yamagiwa took over as chip czar from Liberal Democratic Party heavyweight Akira Amari, who supported Tokyo’s renewed push for chips until he lost his parliamentary seat in an election.

Japan aims to provide 10 trillion yen in new public support to its semiconductor and artificial intelligence industries by fiscal 2030. First, Prime Minister Shigeru Ishiba earmarked about 1.5 trillion yen in his economic stimulus package last month.

The new financing facility will be in addition to approximately 4 trillion yen worth of funds previously set aside, including 920 billion yen for Rapidus. Private company investment in the venture remains small.

Japan hopes the new public funding will be a catalyst for more than 50 trillion yen in public and private investment over the next decade.

Yamagiwa said once Rapidus’ products debut on the pilot line next year, the company may find it easier to understand how they tie into final products such as cars. He said that should help the company attract more private investment and that the government would not shoulder the full 5 trillion yen needed for Rapidus to fully launch.

“Ultimately, we will be operating without government funding,” he said. “That’s our goal.”

Until then, the government will continue to make investments in chips and artificial intelligence safer and easier through subsidies, tax support and loan guarantees, Yamagiwa said.

Japan has faced pressure from the United States over the past few years to align with Washington and increase restrictions on China’s access to chips and key components for artificial intelligence. Superpowers compete for global dominance of these technologies, which are critical to both economic growth and military capabilities.

Pressure on Japan is likely to intensify with the return of Donald Trump to the White House in January, with his new team including officials known for their tough stance on China. The two countries are also Japan’s most important trading partners.

Yamaki Kazu said Tokyo needs to strike a delicate balance between aligning with Washington and maintaining business opportunities for Japanese companies in China.

“We’ve never done anything to blindly provoke each other, and I don’t think we ever will,” he said. “But keeping our country safe is the top priority. We are doing what we need to do to achieve that goal, and we will continue to do so under the Trump administration.”

With the assistance of Yuki Hagiwara.

This article was generated from automated news agency feeds without modifications to the text.