Japan is trying very hard to keep the semiconductor industry working well as the global supply chain gets disrupted, and that is one way to get more economic growth. Fewer countries control the semiconductor sector through their competitiveness.
This imbalance between the countries is especially true for Japan, which has experienced a decrease in its presence by almost 80% in the last 20 years due to strong competition. However, it was not only China that caused such drastic changes in the market; we also have to credit Korea and Taiwan for their strong influence on the semiconductor market.
To start with, The Japanese government is now implementing plans to recover its semiconductor industry. Incentives such as money and grants will be given to foreign and local firms who choose to establish semiconductor plants in Japan.
The motivation behind all these measures is to reduce dependency on imports to avail a consistent and continue supply of semiconductors to strategic industries.
Tokyo Electron and Renesas Electronics are among the companies that are vital in the recovery of the semiconductor sector in Japan. Tokyo Electron is involved in the production of high-tech devices used in the production of chips, while Renesas is mainly involved in the automotive semiconductors, which is the market that is set to grow due to the appearance of electric and autonomous vehicles.
Besides this, the country is also taking such measures as to international collaboration to uplift its semiconductor ecosystem. The cooperation with U.S.-based companies like IBM and Intel to acquire new technologies and have trained personnel is behind it. Equally, Japan intrigued TSMC, and they agreed to work jointly to develop new manufacturing sites in Japan.
One of the benefits of the global semiconductor shortage during the COVID-19 pandemic was the awareness of the necessity for supply chains to be adaptable. The shift of attention of Japan to the semiconductor production along with its geopolitical position is according to the main social policy of the USA and the EU of course. They also intend to create more localized supply chains.
Nevertheless, Japan’s semiconductor ambitions still have to be addressed properly, even though there are few. The industry will require substantial investment in research and development to be able to compete with the existing market leaders such as Taiwan’s TSMC and South Korea’s Samsung Electronics.
Also, the most crucial thing is still attracting capable people, whatever they will be from, as Japan’s population becomes old and the workforce becomes small.
Regardless of these odds, Japan is fairly confident in its revival of semiconductors. The government’s proactive approach, together with industry collaboration, is likely to put Japan once again in a good position in the global semiconductor market.
