About 20 Japanese companies, including electronic component maker Ibiden Co, will work with Taiwan Semiconductor Manufacturing Co to develop chip manufacturing technology in Japan, the Nikkei newspaper reported.
Japan's government will pay half of the 37 billion yen ($337 million) cost of a research facility, The Nikkei said, without disclosing its sources.
TSMC in February said it will spend about $178 million to open a material research subsidiary near Tokyo. Japan wants to cooperate with the Taiwanese company to help its semiconductor manufacturers to stay competitive as chip demand grows with the expansion of 5G infrastructure, autonomous driving technology, data centres and artificial intelligence (AI).
Ibiden and TSMC did not immediately respond to requests for comment.
($1 = 109.7000 yen)
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