On December 26, 2025, Japan’s Ministry of Economy, Trade and Industry (METI) proposed a budget of approximately ¥1.23 trillion ($7.9 billion) for cutting-edge semiconductors and artificial intelligence development for the fiscal year starting in April 2026. The figure represented a nearly fourfold increase from the prior year’s initial budget for those areas.
According to The Japan Times, the overall METI budget rose about 50 percent from the prior year to ¥3.07 trillion, largely due to the jump in chips and AI spending. Prime Minister Sanae Takaichi’s cabinet signed off on the budget plan on December 26, with parliamentary debate scheduled for the new year.
For semiconductors, METI earmarked ¥150 billion for state-backed chip venture Rapidus, bringing cumulative government investment to ¥250 billion. For AI, ¥387.3 billion was allocated for domestic foundation AI models, data infrastructure, and physical AI development. Quantum computing research continued to receive funding within the broader semiconductor and advanced technology allocations.