Japan will offer a subsidy of up to 46.5 billion yen ($320 million) to US-based chipmaker Micron Technology to build advanced memory chips at its plant in Hiroshima, the trade and industry ministry said.
The financial aid announcement, which follows the visit to Japan by U.S. Vice President Kamala Harris, is the latest example of growing co-operation between Washington and Tokyo in chip manufacturing amid growing tension and an intensifying technology rivalry with China.
Japan in July said it would give 92.9 billion yen to U.S. firm Western Digital to enhance flash memory chip output at a Japanese plant operated with local partner Kioxia Holdings, which was spun off from Toshiba.
Micron on Thursday said it was cutting its investment plans by 30 percent to $8 billion for fiscal 2023 amid a fall in demand for PCs and smartphones.
Japan is also providing funds for Taiwan Semiconductor Manufacturing (TSMC) to build a chip plant in Japan along with Sony and auto parts maker Denso.
Japan has seen its share of global output shrink as chipmakers have expanded capacity elsewhere, particularly in Taiwan, which makes most of the world’s advanced semiconductors under 10 nanometres that are used in smartphones and other products, Reuters news report said.
United States is also offering significant amount of subsidy to boost the production of chipsets locally to avoid reliance on China-based tech firms.