"Over 41 Trillion Won Economic Impact" What Happened When TSMC Built a Factory in Japan

[Image source=AP Yonhap News]

[Asia Economy Reporter Jeong Hyunjin] The local economy is buzzing as Taiwan's TSMC, the world's largest foundry (semiconductor contract manufacturer), is building a new semiconductor factory worth 1 trillion yen (approximately 9.7 trillion KRW) in Kumamoto Prefecture, Kyushu, Japan, the Nihon Keizai Shimbun reported on the 24th. It is said that not only related industries but also foreign investors intending to invest in local real estate have appeared.

According to the report, a real estate brokerage in Kumamoto City said that an Asian investor in his 40s visited this spring and said, "I have 2 to 3 billion yen ready. Please introduce some properties planned for sale." The investor came saying that land prices near the area where TSMC is building the factory will definitely rise, and Kumamoto Prefecture will be no exception.

The operator of the real estate company told Nihon Keizai that although the investor did not finalize a contract, "It is the first time I have seen someone offer an amount first rather than discussing yield. He gave the impression of being very proactive and acting quickly." Nihon Keizai also reported that rumors are circulating in the Kumamoto real estate industry that foreign investors and companies are purchasing real estate or looking for golf courses.

Kyushu Financial Group, which owns Higo Bank, a leading regional bank in the Kyushu area, estimated last month that the economic ripple effect in Kumamoto Prefecture due to TSMC's entry will exceed 4.3 trillion yen (approximately 41.6 trillion KRW) over the next 10 years from 2022. It predicted that TSMC's direct construction investment and production volume, as well as the entry of related companies and the resulting industrial park development and housing facilities, will increase Kumamoto Prefecture's current gross domestic product (GDP) of 6.3 trillion yen by about 3% annually, or approximately 200 billion yen.

Nihon Keizai also reported that such investment movements are appearing not only in real estate but also in manufacturing sites. It said that a Taiwanese company made an offer to a semiconductor-related company in Kumamoto Prefecture, expressing a desire to "purchase management rights." The Taiwanese company wanted to establish a base near TSMC's planned factory site, but the Japanese company refused, Nihon Keizai revealed.

As TSMC builds a factory in Kumamoto Prefecture, overseas companies seeking to enter the local market are often trying to enter by acquiring Japanese companies because there are not many industrial sites left in the prefecture. The Kumamoto Prefecture Industrial Association reportedly plans to request at a meeting of about 50 local businesspeople, "Please share any information if there are acquisition offers from foreign investors or if they want to purchase land or buildings," Nihon Keizai also reported.

This content was produced with the assistance of AI translation services.