Japan and the US are discussing a semiconductor plant in the US, part of Tokyo's $550bn tariff-deal investment pledge, Nikkei Asia reported, citing officials from both sides.

The project is estimated at between Y2tn and Y3tn ($12.67bn-$19.01bn) and would broaden the scope of Japan's tariff-related investments, which have so far centred exclusively on power projects, to include technology and manufacturing.

According to the sources, the US first floated the chipmaking project with Japan, and officials from both countries are now working through how the investment could be recouped, along with other outstanding issues.

Working-level discussions were held on Monday (14 September 2026) and Tuesday.

Under the proposal, US-based contract chipmaker GlobalFoundries would run the new plant, which is expected to manufacture logic semiconductors.

The talks came after a broader wave of investment activity in Japan.

Late last month, memory chipmakers Kioxia and SanDisk outlined plans to invest more than $31bn in the country through 2032.

The companies said the investment, which remains contingent on continued government backing, is intended to “deliver leading technology to support the growing demands of an AI and a data-driven world”.

In July, Israel's Tower Semiconductor announced plans to expand its 300mm silicon photonics, silicon germanium, and advanced packaging manufacturing capacity in Japan, an expansion expected to require roughly $3bn in investment.

In March, US President Donald Trump and Japanese Prime Minister Sanae Takaichi unveiled a joint initiative covering a $40bn nuclear power project.

The scheme, to be delivered by GE Vernova and Hitachi, is part of a wider strategic investment fund set up between the two countries, with the companies planning to construct small modular nuclear reactors in Tennessee and Alabama.