As Japan pursues a chip-industry reboot, it's being pressed to build America's chip industry
SMH•Japan will invest up to $21 billion in two chip factories in New York state as part of a $550 billion U.S. investment pledge made in return for lower tariffs. Experts said the investment may do little to revive Japan’s chip industry or improve its supply-chain resilience.
1. U.S. chip investment
Japan will invest up to $21 billion to build two chip factories in New York state under a deal announced by GlobalFoundries. The investment is part of Japan’s pledge to invest $550 billion in the United States in return for lower tariffs, with the U.S. president selecting projects.
2. Limited domestic gains
Experts said the factories may do little to revive Japan’s chip industry or strengthen its supply-chain resilience. “Japan is funding US semiconductor capacity without necessarily gaining much of the advanced chip technology or domestic manufacturing capabilities it wants,” said Nori Chiou of White Oak Capital.
3. Financing and strategy
Japan’s state-backed Japan Bank for International Cooperation and commercial banks will provide loans, backed by guarantees from Nippon Export and Investment Insurance. Japanese banks have been reluctant to participate because of the cost of acquiring the required U.S. dollars, and Tokyo is looking to JPMorgan and other U.S. banks for help. Japan is also backing domestic chip efforts, including Rapidus, which aims to mass-produce cutting-edge chips starting next year.
