Japan will join the ranks of nations betting on silicon-fuelled growth after prime minister Fumio Kishida yesterday instructed his cabinet to put together an economic stimulus package that includes tax breaks for capital investment and R&D related to semiconductors.

The PM's Monday pitch included labor market reforms, further digital transformation, environmental reforms, and overall growth of Japan's industrial capacity through investment promotion and backing startups. The plan was developed in response to tepid growth.

Kishida rated semiconductors as a strategic investment for their potential to bring growth to rural areas, and to boost wages.

The Japanese government has previously sought to boost domestic chip production, which currently centers around the supply of manufacturing equipment - including deep ultraviolet lithography (DUV) machines.

In May, the PM signed the Hiroshima Accord - an agreement with the UK to cooperate on semiconductors. Japan previously agreed to back US chip sanctions.

The country managed to draw in investments last May from Micron Technology, Kyocera and reportedly Samsung, which collectively pledged billions to build and expand chip plants. Meanwhile, IBM agreed to allow Japanese government-backed chipmaker Rapidus Corporation commercialize its 2nm process technology for mass production.

With or without the future stimulus, Japan appears set to score one major silicon investment: multiple reports suggest Mitsubishi Chemical Group plans to build and operate a chipmaking materials plant in the nation by March 2025.

Although the manufacturing giant has not officially named any locations or details, Fukuoka Prefecture is the rumored preferred location for the estimated $6.7 million photoresist polymer plant.

The end product reportedly will be used in argon fluoride laser chipmaking.

The forthcoming plant will complement Mitsubishi Chemical's other photoresist plant in Yokohama, which singlehandedly has supplied around 90 percent of the global photoresist market, according to Nikkei Asia.

The Register has asked Mitsubishi Chemical to confirm reports and will update if anything substantial arises. ®

https://www.theregister.com//2023/09/26/japan_economic_plan_chipmaking/