Japan’s Semiconductor Supply Chain Structure and Its Implications for South Korea

As the competition for technological supremacy between the United States and China has intensified since the 2020s, the Japanese government is also staking its future on the “revival” of its semiconductor industry by strengthening its supply chain. Japan’s global market share in semiconductor products peaked at around 50% in the 1980s but has since fallen to around 10% in the 2020s. It is now maintaining its presence in the so-called legacy semiconductor sector, which includes power semiconductors, microcontrollers (MCUs), and CMOS image sensors. In the semiconductor manufacturing equipment and materials sector, which maintains a relatively high global market share, certain semiconductor materials—such as yellow phosphorus, helium, rare gases, and fluorite—are exposed to the risk of supply chain disruptions due to high import dependence on specific countries. This WEB paper analyzes the supply chain structure of Japan’s semiconductor industry and examines the government’s semiconductor industry policy from the perspective of strengthening supply chain resilience, with the aim of exploring future directions for cooperation between Japan and South Korea in the semiconductor industry. In the second section we analyze the input structure of Japan’s semiconductor industry using input-output analysis, while also assessing the import dependency of Japanese semiconductor products and materials to examine the supply chain structure of the industry. The third section provides an overview of the industrial policies the Japanese government has been pursuing since 2020 to revitalize the semiconductor industry, with a particular focus on the next-generation semiconductor project—the Rapidus 2-nanometer foundry. Section IV proposes a cooperation agenda between South Korea and Japan which involves: first, the sharing of supply chain information regarding export control, and joint procurement of semiconductor raw materials; and second, the joint development of semiconductor back-end packaging technologies and cooperation in the field of AI semiconductors.