Japan’s Toray Industries and a semiconductor material company confirmed investments totaling approximately $120 million in South Korea during industry minister Ahn Duk-geun’s visit to Japan, according to South Korea’s Ministry of Trade, Industry and Energy (MOTIE). Toray plans to expand its advanced materials production in South Korea, with a new aramid fiber manufacturing facility set for completion in 2025.

Ahn also met with a Japanese chemical company representative to discuss cooperation on anode material manufacturing investments, stressing the importance of domestic production for supply chain stability. Additionally, Ahn visited semiconductor equipment company Tokyo Electron Ltd. and chaired the “Japan Market Export Promotion Meeting” to explore ways to increase exports to Japan with various South Korean companies.

Why It Matters

MOTIE’s announcement highlights a growing trend of increased tech cooperation between the U.S., South Korea and Japan. Samsung Electronics announced plans to establish a semiconductor research facility in Yokohama, Japan, with a total investment of $281 million, of which Japan will fund up to $135.7 million in Dec. 2023. Additionally, the U.S. Department of Commerce announced last week that it would provide Samsung Electronics with up to $6.4 billion in direct funding under the CHIPS and Science Act for its semiconductor facilities in Texas.

South Korea’s chip manufacturers face intense competition from countries like the U.S., Taiwan, and Japan, which are aggressively subsidizing the reshoring of semiconductor production. Moreover, South Korea’s global semiconductor market share has declined over the past several years while China’s market share has grown. The increased cooperation between the U.S., South Korea and Japan aims to bolster their competitive edge in the global semiconductor industry.