Plans to build a third Taiwan Semiconductor Manufacturing Co. foundry in Japan have not been confirmed, according to a senior Taiwan government official.
“As far as I know, it hasn’t been decided yet,” Minister of National Development Liu Chin-ching said in Tokyo on Tuesday.
TSMC, the world’s second-largest semiconductor maker by market capitalization after Nvidia, has already completed a plant in Kikuyo, Kumamoto Prefecture. The chip foundry will begin full operations by the end of the year.
A second plant in Japan, located in the same prefecture, is scheduled to commence production in 2027.
In an effort to enhance economic security and increase chip output, the Japanese government has offered an estimated ¥1.2 trillion ($8.3 billion) in subsidies to help TSMC build the first two plants.
A third plant in Japan is expected as early as 2030, Kuo Jyh-huei, Taiwan’s minister of economic affairs, said last month, although he added that the company has the final say.
Liu, who is on TSMC’s board, said he could not confirm plans for a third plant when asked this week.
TSMC has already committed to building three foundries in Phoenix, committing at least $65 billion to the projects. The company will receive up to $6.6 billion in funding from the U.S. government under the CHIPS and Science Act.
During his visit to Tokyo, Liu said that Taiwan hopes that more of TSMC's Taiwanese suppliers would do business in Japan. The move by TSMC, the world's largest contract chip maker, to build production bases in Kumamoto Prefecture has led some of its suppliers to go to Japan, he said.
But “small and midsize companies are still contemplating whether they should also enter the Japanese market. We are thinking about what kinds of support we can offer,” he said.
To assist Taiwan companies in following TSMC into Japan, the Taiwan government is setting up a one-stop counter to provide support, including assistance in buying or leasing land, hiring workers and filing taxes.
After his inauguration in May, Taiwan President Lai Ching-te appointed Liu, a former IBM executive, as the head of the National Development Council, which is charged with drafting Taiwan’s growth strategy.
“We intend to boost investments in Japan,” the minister said on Tuesday.
Taiwan is looking to build capacity overseas as animosity grows between the United States and mainland China, and Liu lists several key conditions that Taiwan prioritizes for investment.
Host countries need to have solid demand in their domestic markets for the product manufactured and have friendly relations with Taiwan. They must also be willing to offer generous financial support.
In that sense, “we can trust Japan, which is a safe and friendly nation,” he said.
Japanese companies have large market shares in the chip-material and production-equipment markets and top-notch technology, so “Japan and Taiwan have a perfect complementary relationship” in terms of semiconductor manufacturing, he added.
Liu encouraged Japan to invest in Taiwan, as more large international players, such as Nvidia and Micron Technology, are already planning to increase investment there.
He noted that Taiwan is looking to deepen economic relations with Japan in other business areas, saying that it wants to increase investment in startups in the country.
It established a startup hub in Tokyo on Wednesday to facilitate exchanges between newly founded Japanese and Taiwan enterprises. Earlier this week, Liu attended the Japan-Taiwan Innovation Summit, which featured about 50 Taiwan startups.
Taiwan is especially interested in robotics, he said.
“We believe robots would be a huge help to counter Taiwan’s declining birth rate problem,” he said.
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