KOTRA: "Japan Aims for 15 Trillion Yen Domestic Semiconductor Sales by 2030"

Japan is promoting digital transformation (DX) to strengthen its national industrial competitiveness. In particular, it is concretizing plans to expand the scale of its domestic semiconductor industry to 15 trillion yen by 2030 through fostering digital-based industries.

KOTRA announced on the 13th that it published a report titled "Japan DX Strategy and New Entry Opportunities" earlier this month, containing these details.

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This report was prepared to present entry strategies for our companies in the rapidly growing Japanese DX market. It includes an analysis of the Japanese government's DX policies, local companies' DX promotion strategies, opportunity factors by major industries, and promising products.

The Japanese DX market is expected to expand dramatically in the future. Fujikimera Research Institute, a leading think tank in Japan, forecasts that the local DX market size will grow to approximately 6.5195 trillion yen by 2030, which is 2.8 times the size in 2021.

The Japanese government is promoting DX policies to increase labor, capital, and technological productivity domestically. In this process, it is focusing on fostering a digital industrial base to support the digital and green economy.

In particular, it aims to expand the local semiconductor industry sales scale to 15 trillion yen, more than three times the 2022 level (5 trillion yen). It has presented a phased roadmap to strengthen the local production base (Phase 1), secure next-generation design technology (Phase 2), and enhance future technology research and development (R&D) (Phase 3).

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It is also targeting the promotion of a digital government centered on the Digital Agency launched in 2021. This involves standardizing and unifying national information systems and standardizing administrative systems of local governments on a cloud basis. To this end, the Japanese government plans to revise 99% of the 9,125 "analog regulation" clauses, which mandate face-to-face and on-site investigations, by June.

Japan’s DX promotion is expected to provide various market opportunities for our companies, which have strengths in IT. In particular, five industries are seen as promising: manufacturing, logistics and transportation, telecommunications and information security, edutech, and elderly care.

Kim Samsik, head of KOTRA’s Japan Regional Headquarters, advised, "Japan regards digital technology as the key to solving pressing issues such as super-aging and low labor productivity. To enter the Japanese digital market, it is important to build relationships with Japanese IT industry partners and accumulate references through local exhibitions and KOTRA consultation meetings."

Meanwhile, regarding the status of DX promotion by Japanese companies, challenges such as IT talent shortages and aging systems are acting as obstacles. According to the Japan Information Processing Development Corporation, the DX promotion rate is 94.8% for large companies and 39.6% for small and medium-sized enterprises, showing a significant gap.

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