TOKYO: In a bid to reclaim the status of a global tech leader and meet the urgent challenges, Japan has announced to inject $65 billion in microchips and artificial intelligence.
The package, which is likely to be approved this week, is seen as preparation to counter growing Chinese influence in chip making. However, analysts warn about whether Japan would be able to generate enough electricity for the AI data centres.
Kelly Forbes, president of the AI Asia Pacific Institute speaking to AFP said that after dominating tech hardware during the 1980s, Japan had quite a long period of almost just sitting back and observing a lot of this innovation, particularly when it comes to artificial intelligence.
“What we have seen in the last maybe two to three years is Japan really waking up to the potential”
Japanese tech investor SoftBank and US computing giant NVIDIA last week announced proposals to build an “AI grid” across Japan.
NVIDIA in a statement said that it is aiming to create an AI marketplace that can meet the demand of the local population and secure AI computing.
“This new service, which supports AI training and edge AI inference, positions SoftBank to become the AI grid for Japan, facilitating new business opportunities for the creation, distribution and use of AI services across the country’s industries, consumers and enterprises,” it said.
Japanese Prime Minister Ishiba Shigeru had announced that Japan’s government was setting up a fund worth more than 10 trillion yen, or $ 65 billion, to bankroll domestic development of next-generation technologies, including artificial intelligence and semiconductors, the NHK reported.
He said the government may issue bridging bonds to raise the funds, which will be made available through fiscal 2030.
The government of Japan has been stepping up support for Japan’s semiconductor industry and has allocated nearly $ 26 billion over the past three years for next-generation chip development.
AI-powered automation can help Japan, which has the world’s second oldest population after Monaco, Seth Hays, author of the Asia AI Policy Monitor newsletter told AFP. “Demographically speaking, Japan’s just going to be crunched on that,” he said.
It is pertinent to mention that most of the world’s chips are made in Taiwan. Taiwanese chip giant TSMC in February opened a $8.6bn chip factory in southern Japan.
Japan is dependent heavily on fossil fuel imports, with the government working to bring back online nuclear plants that stopped functioning after the 2011 Fukushima disaster.
