Japan’s semiconductor industry, once globally dominant in DRAM during the 1980s, declined through the 1990s and 2000s due to trade friction with the United States, the rise of Korean competitors, and a failure to adapt to the fabless/foundry model. Today, Japan’s logic IC process technology lags at the 40nm node. 

The 2020 global semiconductor shortage prompted Japan to launch two major revitalization projects under the banner of economic security: TSMC Kumamoto, a joint venture producing 12–28nm logic ICs for Japan’s automotive, industrial, and consumer electronics sectors; and Rapidus, an ambitious startup targeting 2nm logic IC manufacturing by 2027. 

The paper argues that while TSMC Kumamoto meaningfully strengthens Japan’s domestic supply chain — connecting Japanese equipment and materials suppliers with downstream industries — Rapidus tells a different story. Because Japan has virtually no domestic industrial base currently using 2nm chips, Rapidus’s primary market will likely be the United States. Rather than enhancing Japan’s supply chain resilience, Rapidus effectively inserts Japan into a global advanced logic IC supply chain running from the Netherlands through Japan to the United States. Unless Japan develops industries using these chips, the Rapidus project will not directly address Japan’s economic security strategy.