At the end of the 1980s, Japan was the world’s largest producer of semiconductors, accounting for more than half of the global production. Over the years Japan’s share has decreased significantly and four decades later this number has fallen to a mere 9 percent. Countries such as Taiwan and South Korea on the other hand have been able to ramp up their production, accounting for 17 and 50 percent of the semiconductor world market respectively.

Today, Japan’s semiconductor industry is estimated to lag 10 years behind the global technological leaders, explaining the government’s recent efforts to revitalize the industry. Through the provision of subsidies to companies engaged in the semiconductor manufacturing process, the Japanese government is seeking to increase its domestic production capacity. Nevertheless, japan remains a strong and indispensable player in the global semiconductor value chain.