The Japanese government is considering financial support for Taiwan Semiconductor Manufacturing Co. to build a chip-making factory, potentially with Sony Group Corp., in Kumamoto Prefecture, sources with knowledge of the matter have said.

The aid for the world's largest contract chipmaker, which may be worth several billion U.S. dollars, could be included in a supplementary budget that Prime Minister Fumio Kishida aims to compile by the end of December, underscoring his sharpened focus on the economic dimensions of national security, the sources said Friday.

The bolstering of supply chains for critical components such as semiconductors has become a pressing issue. Japan has agreed with the United States to step up cooperation in the area as Washington and Beijing compete for a technological edge.