As the tech war between the U.S. and China intensify, Japan has spotted an opening to build a viable alternative for chips, so that it doesn't run out of memory chips. A group of Japanese tech firms and car makers are working together to create an advanced chip maker. The next generation of logic semiconductors will be developed and mass-produced by the year 2027.

The Japanese government will back Rapidus with 70 billion dollars, joining the eight tech corporations to reduce its dependency on chip production in other countries. According to Japan's industry ministry, each participating company will invest over a billion dollars in Rapidus.

According to the Minister of Economy, Trade and Industry, Semiconductors are going to be a critical component for developing new leading-edge technologies. Semiconductors are becoming even more important from an economic security standpoint.

A joint research center between Japan and the U.S. will be built to develop 2-nanometer advanced chips. The research hub will include a number of research institutions and companies. The Japanese government plans to invest over a billion dollars in advanced production and secure materials for manufacturing.

Rapidus will need a license from IBM to make sub-2 nanometer chip technology in Japan, according to reports.

Rapidus wants to develop chips for 5G, quantum computing, data centers, self-driving vehicles and digital smart cities.

Taiwan Semiconductor Manufacturing was subsidized by Japan to expand their chip production in Japan. The idea is to strengthen its competitiveness in the Semiconductor sector with R&D and production of its own advanced chips for Japanese car makers and tech companies.

According to a media outlet, Japan has new production lines for 40-nanometer chips.

TSMC plans to begin mass production of 3 nm late this year, while SAMSUNG has begun mass production of 3 nm this year.