Japan to Seek 400 Billion Yen More for Chipmaker Rapidus, Taking State Stake to 650 Billion Yen

Japan’s Ministry of Economy, Trade and Industry (METI) intends to inject a further 400 billion yen into state-backed chipmaker Rapidus Corp over the three fiscal years through 2029, Jiji Press reported, a move that would lift the government’s total equity investment in the company to 650 billion yen.

The plan was set out on Monday in documents METI presented to a subcommittee of the Fiscal System Council, the panel that advises Japan’s finance minister. The government has already committed 250 billion yen to the Tokyo-based company, which is working to mass-produce cutting-edge logic chips at home.

How the money would flow

According to Jiji and legal and regulatory news service MLex, the ministry is asking for 150 billion yen in its fiscal 2027 budget request, and hopes to secure another 150 billion yen in fiscal 2028 and 100 billion yen in fiscal 2029. MLex put the total at roughly US$2.5 billion. Each year’s tranche still depends on the annual budget request being approved.

The stated aim is to strengthen Rapidus’ balance sheet. A higher equity ratio, the ministry argues, will make it easier for the company to raise commercial bank financing. MLex reported that Rapidus plans to borrow around 2 trillion yen from private lenders, with part of that debt backed by government guarantees.

Race to 2-nanometre production

Rapidus is targeting mass production of 2-nanometre semiconductors in the second half of fiscal 2027, MLex said. That first year of commercial output coincides with the first tranche of the new funding, a period when the company will also be leaning on private loans to expand its production lines.

The project sits at the centre of Tokyo’s push to build a domestic advanced-chip industry. Taking a larger equity position gives the state a direct stake in any future returns, but also ties more public money to the venture’s commercial success.

Scrutiny from the fiscal panel

The request will be weighed by the Finance Ministry’s advisers alongside other spending demands. South Korean broadcaster SBS, citing Japanese media, reported that council members stressed the need to keep verifying whether the investment can turn a profit, and raised the question of whether such industrial investments should be made every year.

The funding news landed during a volatile week for Japanese technology shares, with investors weighing rising bond yields and inflation risks ahead of the Bank of Japan’s two-day policy meeting that ends on October 30.

What’s next

The 150 billion yen earmarked for fiscal 2027 will now go through the government’s budget process. Later tranches will need fresh approval each year, leaving the full 400 billion yen contingent on annual budget decisions as Rapidus works towards its production and financing milestones.