Understanding Japan's Semiconductor Policy and the Kumamoto-Kyushu Industrial Cluster: From TSMC's Entry to the Development of Domestic Production Capacity and an Industry Ecosystem

Since the 1960s, semiconductor-related suppliers have continued to cluster in Kyushu, which is now home to approximately 1,000 companies. As of 2024, Kyushu accounted for approximately half of Japan's IC production value, which exceeded ¥1 trillion for the third consecutive year. Following TSMC's announcement in 2021 that it would establish operations in Kumamoto, approximately ¥6.2 trillion in new investment has been planned or implemented in Kyushu over a 10-year period.

The government's strategic industry cluster plan includes the development of sites not only for device manufacturing plants, but also for materials, design, manufacturing equipment, prototyping, and testing, with JASM expected to reach production capacity of approximately 100,000 wafers per month. The plan envisions investment by surrounding companies attracting further investment and strengthening Kyushu's industrial base.

Japan's semiconductor policy is expanding from securing production capacity to strengthening the competitiveness of entire regions. The target for domestic semiconductor sales is ¥15 trillion in 2030 and ¥40 trillion in 2040. Kyushu is home to a diverse range of operations, including JASM, Sony Semiconductor, ROHM, SUMCO, and Tokyo Electron.

The focus going forward will shift beyond the scale of investment to the establishment of research and development, talent, materials, equipment, local suppliers, and user industries, as well as the creation of value within the region. The key question is whether the cluster originating in Kumamoto can contribute to raising the competitiveness of Japan's domestic industries, going beyond the rebuilding of manufacturing sites.