On July 29, the newly-established U.S.-Japan Economic Policy Consultative Committee met for the first time and issued a statement laying out how both countries want to “foster supply chain resilience,” especially in the field of semiconductors. (Related: Computer chip crisis getting worse as manufacturing slows and wait times increase amid insane demand.)
The statement announced that Japan will open a research and development center by the end of the year. This facility will be set up by a new Japanese chip research institution slated to debut later this year and will receive aid in the form of equipment and personnel from the U.S. National Semiconductor Technology Center.
The focus of this new R&D center will be to research cutting-edge 2-nm semiconductors, which offer superior performance while using less power. The center will include a prototype production line with the goal of beginning mass production of 2-nm chips domestically as early as 2025.
The center will also conduct research on chip design, the development of manufacturing equipment and materials and the installation of production lines. Businesses will be invited to participate in the R&D center, and the center will offer its technology to companies in Japan and the U.S. once mass production becomes feasible. The committee noted that both nations are also open to the possibility of offering partnerships with businesses in nations with “shared values,” such as Taiwan and South Korea.
Committee members – which include State Secretary Antony Blinken, Commerce Secretary Gina Raimondo and the Japanese ministers for foreign affairs and economy, trade and industry – are planning to release a more comprehensive statement on bilateral supply chain cooperation.
“As we discussed today, semiconductors are the linchpin of our economic and national security,” said Raimondo, adding that U.S. and Japanese officials discussed collaborating on semiconductor development, “especially with respect to advanced semiconductors.”
More countries looking to diversify chip production market
The U.S. and Japan’s foray into 2-nm chip development comes over a year after IBM became the first company to announce the development of 2-nm chip technology. Taiwan Semiconductor Manufacturing Company (TSMC), the world’s largest manufacturer of semiconductors, is also set to begin mass production of 2-nm chips by 2025.
More countries are looking at diversifying the chip production market, perhaps remembering the economic damage done by the semiconductor shortage during the height of the supply chain crisis. Taiwan, thanks to TSMC, currently hosts over 90 percent of the world’s production capacity for chips that are less than 10 nm in size, which are used to make smartphones.
South Korean tech and manufacturing company Samsung, which comes second to TSMC in chip making, is already attempting to compete with TSMC in the manufacturing of 3-nm and 5-nm chips. But most other tech manufacturers like Apple, Qualcomm, Nvidia, Broadcom, AMD and Intel still rely on TSMC to make their most advanced products that need semiconductors.
Amid heightened tensions between China and Taiwan and the prospect of the former attempting to forcefully unify with the latter through a military operation, Japan and the U.S. have decided to step up to ensure better access to new chips.
In addition to investing in the R&D center for 2-nm chips, Japan and the U.S. are preparing to line up fiscal support to boost their already existing chip industries. Tokyo has proposed investing a trillion yen ($7.45 billion) into research and development over a decade. Washington has passed the CHIPS and Science Act, which includes $52 billion in subsidies for semiconductor production and research.
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Watch this clip from “The Kim Iversen Show” as host Kim Iversen discusses House Speaker Nancy Pelosi risking a world war for more semiconductors.
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