With relations between Japan and China showing little sign of recovery and Taiwan's semiconductor industry gaining prominence, local governments across Japan are stepping up exchanges with Taiwan and efforts to attract investment from the island.
The Nihon Keizai Shimbun, or Nikkei, reported on the 4th that local governments throughout Japan are expanding cooperation with Taiwan, centered on the semiconductor industry.
Kitakyushu, an industrial city in northern Kyushu, recently organized its first delegation to Hsinchu, Taiwan. Hsinchu is home to the headquarters of TSMC, the world's largest contract chipmaker, and the city is said to have explored possibilities for industry-academia-research cooperation there.
Taiwan's ASE Group, the world's largest chip packaging and testing company, is also reported to be considering an entry into Kitakyushu.
In Gifu Prefecture in central Japan, local government officials and business leaders visited Taiwan to pitch investment to the Taiwanese government and semiconductor-related companies.
Miyagi Prefecture, home to chip equipment maker Tokyo Electron and other firms, is also broadening its contacts with Taiwan. The prefecture held a separate investment briefing to coincide with SEMICON Taiwan, an international semiconductor exhibition held in Hsinchu last month, where it introduced support measures aimed at drawing companies to the region.
Cooperation between local governments in Japan and Taiwan is also growing rapidly.
According to the Japan-Taiwan Exchange Association, about 180 partnership agreements of various kinds had been signed between local governments in the two places as of the end of July this year. About two-thirds of them were concluded after the fall of 2021, when TSMC's move into Japan took concrete shape.
Expanding semiconductor investment in Japan by Taiwanese companies has translated into more exchanges between local governments. In Kumamoto, where TSMC built a plant, Nikkei projected that the clustering of semiconductor-related companies would generate an economic impact of about 10 trillion yen (approximately 85 trillion won) over the next 10 years.
Analysts say the reason Japanese local governments are turning to Taiwan as a new partner lies not only in the semiconductor industry but also in the current international situation.
A Japanese financial industry official with experience in Taiwan-related work told Nikkei that a prolonged period of yen weakness has made Europe and the United States relatively harder to approach, while political circumstances have made exchanges with mainland China difficult as well. In that environment, the official said, Taiwan is emerging as a realistic alternative for Japanese local governments.
