Japan To Issue New Bonds Backed By NTT Stake To Aid Chip Industry

The Japanese government has decided to issue new bonds backed by securities it owns, such as its stake in Nippon Telegraph and Telephone Corp. (NTT), to fund measures supporting Japan's semiconductor industry, a source close to the matter said, Kyodo News reported.

The plan, aimed at aiding semiconductor companies, including the government-backed chip venture Rapidus Corp., will be incorporated into an economic stimulus package expected to be outlined this month. I Photo: Akonnchiroll Wikimedia Commons

The plan, aimed at aiding semiconductor companies, including the government-backed chip venture Rapidus Corp., will be incorporated into an economic stimulus package expected to be outlined this month, the source added.

The decision follows the government’s pledge to provide extensive support to companies focused on semiconductors and artificial intelligence until around 2030, as resource-poor Japan has struggled to secure access to these technologies domestically.

Taiwan Semiconductor Manufacturing Co. (TSMC), the world’s largest contract chipmaker, which has begun building plants in Kumamoto Prefecture, southwestern Japan, is also expected to benefit from the new economic package, according to the source.

The bonds will be issued with the condition that the collateral can be used for future repayment, ensuring that fiscal discipline is maintained, the source said. Japan’s fiscal health remains the weakest among major developed economies, Mainichi Japan also reported.