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Japanese government to subsidize Sumco factories to the tune of $530 million

Sumco logo infront of Saga prefecture

Last week, Neowin reported that EU Commissioner Thierry Breton was in Japan trying to arrange a deal on semiconductors. Now, Nikkei has reported that the Japanese government will pay $530 million to Sumco, a domestic silicon wafer producer to help it build new factories and prop up the country’s semiconductor industry as a whole.

In Japanese yen, the amount being given for the Sumco silicon wafer factories is 75 billion yen. In total, it expects to spend 225 billion yen on new factory buildings and production equipment so the government is paying for a third of the cost.

Sumco has its main production base in the Saga prefecture in the south of the country. According to Nikkei, the new silicon wafer manufacturing and processing plants will be built in nearby towns and cities and wafer production should start in 2029.

That area of the country has lots of fresh water which is required to chip manufacturing, so it’s a good place to build more factories. Other semiconductor companies have moved into the area too including Tokyo Electron and Taiwan’s TSMC. With all these companies there, it should attract the skilled workers that they need to the area.

Sumco is reportedly going to be supplying silicon wafers to friendly nations such as the United States and countries in Europe. Nikkei said the potential for a war in the Taiwan Strait is pushing countries to develop more manufacturing hubs around the world.

Sumco is not the only country which is going to receive subsidies from the government. TSMC is set to get 476 billion yen for its plant in Kyushu’s Kumamoto prefecture, 40.5 billion yen will be given to Ibiden for a chip packaging plant, and Canon will get 11.1 billion yen for a manufacturing equipment plant. The country has set aside 2 trillion yen in its budget over two years for semiconductors.

Source: Nikkei

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