Japanese Prime Minister Shigeru Ishiba has introduced a $65 billion plan to support the nation’s chip and AI industries through subsidies and financial incentives.

Japan’s 10 trillion yen ($65 billion) plan aims to strengthen its chip and AI industries by fiscal 2030, focusing on securing control over chip supply chains amid global trade tensions.

The plan targets chip foundry venture Rapidus and other AI chip suppliers, with an expected economic impact of around 160 trillion yen.

Rapidus, led by industry veterans, aims to start mass-producing advanced chips in Hokkaido by 2027 in collaboration with IBM and Belgium’s research organisation Imec.

Prime Minister Ishiba announced that the government would not use deficit-covering bonds to fund the chip industry plan but did not disclose other funding details.

Last year, Japan committed about 2 trillion yen to support its chip sector.

Japan’s new plan, set for cabinet approval on 22nd November, includes a combined public and private investment of 50 trillion yen in the chip industry over the next decade.

Prime Minister Ishiba announced plans to meet with business and labour unions to discuss wage negotiations for next year as the government focuses on achieving sustainable wage growth amid rising living costs.

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