Japan, the United States, and Europe will share chip subsidy information to avoid oversupply

According to the Nikkei Asia Review, this arrangement covers information such as the conditions for enterprise subsidies, the amount and reasons for subsidies, and the expected internal supply and demand created by incentive measures.

The Japanese Minister of Economy, Industry, and Industry, Nishimura Yasumi, and the European Internal Market Commissioner, Thierry Breton, are expected to reach an agreement as soon as early July. Information exchange has begun between Japan, the United States, and the United States and Europe. Currently, Japan and Europe will also share information to establish a stronger and more stable chip supply chain.

Sharing information helps partners understand where and how many specific types of chips need to be produced to meet demand in emergency situations. Japan has taken quick action in this regard and has subsidy conditions that can provide reference for the EU. However, the EU has a relatively negative attitude, and although the United States has also ensured its budget, there are no actual examples of subsidies being issued.

Tsuyoshi Kawase, a professor at the Law School of Sophia University, believes that sharing subsidy information among governments is a new development in the world.

Obviously, after the unprecedented core shortage crisis at the end of 2021, countries around the world hope to establish a more stable semiconductor supply chain. Japan, the United States, and Europe have a sense of crisis regarding semiconductor shortages, and in order to expand domestic production, they are attracting investment through a huge subsidy system. Japan has secured a budget of around 2 trillion yen for the two years ending in 2023.

The United States will invest around 7 trillion yen within five years of 2027. The European Union temporarily passed the "European Semiconductor Act" in April, and by 2030, officials and civilians will prepare around 6 trillion yen.

TSMC is building factories in the United States and Japan, and is also considering entering Germany; Intel is building factories in the United States and Germany; Samsung is establishing a new factory in the United States and a research and development base in Japan. But the report also pointed out that such incentives are likely to fuel oversupply unless the government works together to disperse resources across a range of different products.