Japan’s semiconductor push and strategic opportunities for Australia

By Aaron Magunna

In this Indo-Pacific Analysis Brief, Visiting Fellow Aaron Magunna explores Japan’s ambitious plans to revitalize its domestic semiconductor manufacturing industry, and the opportunities this move presents for Australia’s critical minerals sector.

Key Messages

• Japan has launched an ambitious financing program to revitalize its domestic semiconductor manufacturing industry as geopolitical competition between China and the US increases.
• Australia’s (and especially Western Australia’s) access to critical minerals needed for semiconductor production makes closer Australia-Japan cooperation on critical minerals crucial.
• As global semiconductor supply chains are remade, Australia should focus on leveraging its mineral deposits and the expertise of Australian mining companies to develop more resilient supply chains, including by co-financing projects (or attracting Japanese investments) that support Japan’s semiconductor manufacturing aspirations. Investments should specifically target the extraction of lithium, nickel, and rare earths.
• Such an approach would be consistent with Australia’s Critical Minerals Strategy 2023-30, along with the Australia-Japan agreement on collaboration in the critical minerals sector.