The Japanese government has allocated about 1.5 trillion yen in supplementary budget to strengthen the chip, quantum computing and AI industries, with part of the money going to chip startup Rapidus
On November 29, 2024, the Japanese government
Summary of the FY2024 supplementary budget proposal for the Ministry of Economy, Trade and Industry
(PDF file) https://www.meti.go.jp/main/yosan/yosan_fy2024/hosei/pdf/r6_point.pdf
Japan Earmarks Extra $9.9 Billion for Chips and AI This Year - Bloomberg
https://www.bloomberg.com/news/articles/2024-11-29/japan-earmarks-extra-9-9-billion-for-chips-and-ai-this-year
Japan's Chip Shares Climb on Hopes of Lighter US Curbs on China - Bloomberg
https://www.bloomberg.com/news/articles/2024-11-28/japan-s-chip-shares-climb-on-hopes-of-lighter-us-curbs-on-china
US chip policy shift boosts Japanese semiconductor stocks
https://www.techinasia.com/news/us-chip-policy-shift-boosts-japanese-semiconductor-stocks
The supplementary budget proposal for fiscal 2024 provides 1.514 trillion yen in support for the development and demonstration of design and manufacturing technologies for advanced semiconductors, quantum computing, and generative AI, as well as a budget of 471.4 billion yen for semiconductor manufacturers such as Rapidus to boost private investment, allocating a total budget of approximately 1.5 trillion yen to strengthening the digital industrial infrastructure, including semiconductors and AI.
The Japanese government has already provided Rapidus with 920 billion yen in support. Rapidus has been building a factory in Chitose City since 2023, with a prototype line up and pilot production by 2026. Production of 2nm process rule products is scheduled to start in 2027, and there are plans to update the facilities to accommodate the production of 1.4nm process rule products in the future. The METI official did not disclose the amount of support for Rapidus in this supplementary budget proposal.
Semiconductor manufacturer Rapidus requests additional investment of 100 billion yen - GIGAZINE
On November 22, 2024, the government decided at a cabinet meeting to provide public support of 10 trillion yen to the semiconductor and AI sectors over the seven years from 2024 to 2030, and the support for the semiconductor and AI sectors in this supplementary budget proposal is seen as part of this long-term goal.
With support for Rapidus in mind, the government has decided to provide 10 trillion yen in semiconductor and AI support: Careful responses are required to avoid careless support that could increase the risk of business failure and increase the burden on the public | 2024 | Takahide Kiuchi's Global Economy & Policy Insight | Nomura Research Institute (NRI)
https://www.nri.com/jp/knowledge/blog/lst/2024/fis/kiuchi/1112_2
In recent years, the US government has imposed export restrictions on chip manufacturing equipment and AI memory to China for security reasons. According to sources, under President Joe Biden, the US government plans to blacklist Huawei, but will exempt ChangXin Memory Technologies, which is working on AI memory chip technology, from the sanctions. The US government's measures this time were less severe than the market expected, and Huang Liping, chief technology analyst at Huatai Securities, said, 'The worst case scenario that the market feared has been avoided.'
As a result of this news, the shares of Tokyo Electron and Kokusai Electric , which are manufacturers of chip manufacturing equipment, rose sharply. Andrew Jackson, head of Japanese equity research at Ortus Advisors, reported that 'this news was positive for Japanese semiconductor stocks, which have a relatively high proportion of their sales in China.'
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