The new company is expected to commence the production of semiconductor chips in the latter half of the decade

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Japan to boost its semiconductor manufacturing sector by setting up a new company. (Credit: brookhaven from Pixabay)

The Japanese government will invest up to JPY70bn ($500m) to create a new semiconductor company reportedly named Rapidus in an effort to re-emerge as a top manufacturer of advanced chips.

The new semiconductor firm will be led by Sony Group, NEC, and other technology firms, reported Reuters.

Rapidus is expected to commence the production of semiconductor chips in the latter half of the decade.

At a news briefing, Japanese Minister of Economy, Trade, and Industry Yasutoshi Nishimura said: ‚ÄúSemiconductors are going to be a critical component for the development of new leading-edge technologies such as AI, digital industries and in healthcare.”

Earlier this week, TV Tokyo reported that the new semiconductor company will also get investment from Japanese computer memory manufacturer Kioxia and Nippon Telegraph and Telephone.

Rapidus marks the next phase in the Japanese semiconductor strategy, wrote Reuters, adding that it further shows its increasing cooperation in technology development with the US.

In July this year, Japan and US agreed to open a new joint research centre to build next-generation 2-nanometre semiconductors.

The Japanese government is also providing financial assistance to foreign chip manufacturers to construct chip factories in the country.

Earlier this year, Toshiba Electronic Devices & Storage announced plans to develop a new 300mm wafer fabrication facility in the Ishikawa Prefecture in Japan. The facility was decided to be built at Kaga Toshiba Electronics, which is the main production base of the company for discrete semiconductors.