Overview
- Japan’s government growth strategy council has formalized a 370 trillion yen target for combined public and private investment across 17 strategic sectors by fiscal 2040.
- The plan aims to lift domestic semiconductor annual sales from about 8 trillion yen today to 40 trillion yen by 2040 and channels large subsidies to domestic chipmakers.
- The government earmarks roughly $65 billion for physical AI and is seeking more than a 30% share of the global AI robotics market to replace shrinking numbers of working‑age people.
- Officials and analysts warn that parallel, large state-backed programs in the United States, China, and the EU could push global chip capacity high enough to create oversupply and pressure industry economics.
- The strategy builds on prior commitments since 2021, includes firms such as Rapidus— which has received about 1.7 trillion yen in subsidies— and will use subsidies, tax incentives, and infrastructure to attract private capital.