TSMC Japan plan for advanced chips seen as hedge against pressure from US, China

Taiwan Semiconductor Manufacturing Company’s plan for advanced chip production at a Japanese plant will help it hedge against US tariff threats and the possibility of a Beijing blockade around Taiwan, analysts said, while providing Japanese giants such as Sony and Toyota with local access to advanced chips for artificial intelligence applications.C C Wei, president and CEO of the world’s top chip foundry, known as TSMC and based in Taiwan, said on Thursday after meeting Japanese Prime Minister Sanae Takaichi that the company planned to fabricate wafers with its coveted 3 nm process at a factory in Kumamoto prefecture, west of Tokyo.The Kumamoto plant would help TSMC diversify production to avoid geopolitical pressures, experts said.The expanded Japan presence would ensure that some of the foundry’s chip production remained immune from US President Donald Trump’s on-again, off-again import tariffs, and would reduce the impact of any possible blockade by mainland China around Taiwan, where most of TSMC’s wafer fabs are located, analysts said.Trump lowered tariffs on Taiwanese imports last month to 15 per cent from 32 per cent early last year after TSMC pledged to invest US$165 billion in advanced chipmaking in the US state of Arizona, but on January 14 the White House announced a 25 per cent global tariff on certain advanced computing chips.An aerial view of the TSMC fabrication plant in Kaohsiung, Taiwan, June 7, 2025. Photo: Reuters“The strategic importance of the so-called silicon shield – that advanced technology is an insurance against abandonment by the US – is not to be surrendered easily, even under the tariff threat,” said Yoichiro Sato, dean of the College of Asia-Pacific Studies at Ritsumeikan Asia-Pacific University in Japan.