1.5 Trillion Yen Semiconductor Factory and the Doubling of Bus Fares in 20 Years—Investments That Reach Hiroshima and Those That Don’t

Within the Same Prefecture, One Side Receives 1.5 Trillion Yen While the Other Sees Bus Fares Double

In Higashihiroshima City, Hiroshima Prefecture, U.S. semiconductor manufacturer Micron Technology is advancing plans to build a new factory with a total investment of approximately 1.5 trillion yen. This facility is expected to mass-produce cutting-edge DRAM for generative AI, creating over 1,000 new jobs, with an estimated economic ripple effect of around 750 billion yen across the prefecture.

On the other side of the same Hiroshima Prefecture lies Etajima, an island in the Seto Inland Sea with a population of about 20,000. Here, the one-way transportation cost for transferring from a bus to a ferry to the mainland has nearly doubled over the past 20 years. The costs associated with commuting for medical visits, shopping, and schooling are quietly but surely eroding the financial stability of residents.

1.5 trillion yen versus a few hundred yen for bus fares. The difference in scale may make it seem reckless to compare the two. However, these two figures point to the same question—”Who benefits from investment?”

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The Structure of “Reaching Investments”—How Micron and Higashihiroshima Align

Micron’s choice of Higashihiroshima was not by chance. The company established its roots in the area in 1999 by taking over the former Elpida Memory factory, building a production base over the past quarter-century. Existing clean rooms, supply chains, and a pool of skilled technicians—such structures must exist beforehand for investments to “reach” their intended targets.

In this expansion investment, the Japanese government has indicated a plan to provide up to approximately 200 billion yen in subsidies. This is part of the Ministry of Economy, Trade and Industry’s initiative to bring semiconductor production back to Japan, and it stands alongside TSMC’s expansion into Kumamoto as a symbolic project. National policy, corporate strategy, and regional accumulation have aligned at a single point.

The changes for Higashihiroshima City extend beyond just employment. Programs for training semiconductor talent in collaboration with Hiroshima University, attracting related companies, and increasing housing demand in the surrounding area—the cycle of investment attracting further investment has already begun. An increase in the city’s tax revenue is also anticipated, creating room for reinvestment in urban infrastructure.

In other words, Micron’s 1.5 trillion yen did not simply “fall from the sky”; it “arrived because there was a structure in place to receive it.” Misunderstanding this order can lead discussions on attracting investment to go awry from the outset.

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The Reality of “Investments That Don’t Reach”—What Etajima’s Transportation Costs Reveal

Etajima City has a population of about 20,000, which has decreased by approximately 30% since the merger in 2004, with an aging rate exceeding 45%. Bus services on the island have been reduced, and the number of ferry operations is also on a downward trend.

Let’s look at the specific burden in numbers. The one-way fare from central Etajima to central Hiroshima, using a ferry and bus, is approximately 1,200 to 1,500 yen. This section, which used to cost around 700 to 800 yen 20 years ago, has nearly doubled due to fare revisions stemming from a decrease in users and rising fuel costs. If one makes the round trip four times a month for medical visits, transportation costs alone exceed 10,000 yen. For elderly residents living on pensions, this amount can influence their decision on whether to travel.

What happens when one gives up on traveling? The frequency of medical visits decreases, shopping options narrow, and opportunities to meet others diminish. The rise in transportation costs acts not merely as a household issue but as a force that shrinks the very living space of the residents.

Etajima City is not sitting idly by. They are exploring alternative means within a limited budget, such as introducing demand-responsive shared taxis and operating community buses. However, annual transportation-related subsidies have reached several hundred million yen, continuously straining the city’s finances. As the population decreases, fare revenues decline, and raising fares leads to even fewer users—there is still no visible mechanism to escape this spiral of contraction.

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Numbers Reflecting Two Different Times Within the Same Prefecture

The total population of Hiroshima Prefecture is approximately 2.74 million (2024 estimate). Higashihiroshima City has about 190,000 residents and is on a slight upward trend, while Etajima City has about 20,000 residents and continues to decline. Within the same prefecture, municipalities with growing populations and those with decreasing populations are adjacent to each other.

The annual shipment value of manufactured goods from Higashihiroshima City exceeds 1 trillion yen, ranking at the top within the prefecture. If Micron’s production increases in earnest, this figure is expected to rise further. On the other hand, Etajima City’s main industries are oyster farming and shipbuilding, both of which are experiencing an aging workforce. The differences in industrial structure directly reflect the disparities in investment attraction.

It is noteworthy that this gap did not “suddenly arise” but has been structurally built up over the course of 20 to 30 years. Higashihiroshima benefited from the relocation of Hiroshima University (1982-1995), which laid the groundwork for attracting industrial clusters as an academic research city. Etajima has a history linked to the former Naval Academy, and the presence of the Self-Defense Forces has provided a certain economic foundation, but it has not led to the accumulation of private industries.

In both regions, past choices and the accumulation of structures define their current situations. Whether investments reach or do not reach is determined not just by efforts at a single moment.

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Can We Design a “System to Deliver Investments”?

So, is it possible to “deliver” investments to regions like Etajima?

One clue lies in how much of Micron’s economic impact can be circulated within the prefecture. The housing, food, education, and medical needs of the people working in the factory—will these demands be met solely within Higashihiroshima City, or will they extend to surrounding areas? If the prefecture and municipalities can intentionally design these pathways, the “reach” of investments can expand.

Another aspect is a shift in thinking regarding transportation infrastructure. The transportation issues in Etajima cannot be resolved solely by subsidizing fares. The introduction of MaaS (Mobility as a Service), trials of autonomous driving technology on islands, or the establishment of systems that reduce the need for travel through telemedicine or mobile sales—there is a slowly growing reality that technology could serve as an alternative to transportation.

Hiroshima Prefecture has shown its commitment to addressing challenges in mountainous and island regions through DX promotion projects like the “Hiroshima Sandbox” in 2023. However, there is still a gap between demonstration experiments and the daily lives of residents. The existence of a system and the operation of that system are not the same.

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Reassessing How Investments Reach

The 1.5 trillion yen semiconductor factory and the doubling of bus fares over 20 years—these two facts question not the “quantity” of investments but the “manner in which they reach.”

Concentrating massive investments in one area is rational as an industrial policy. In fields like semiconductors, where economies of scale apply, concentration tends to yield better results than dispersion. However, without a system to deliver the benefits of that concentration to every corner of the prefecture, the existence of “places where investments reach” and “places where they do not” will become fixed within the same prefecture.

Elderly residents riding the bus in Etajima may not know about Micron’s stock price or the market conditions for DRAM. Yet, whether they can go to the hospital depends on what the community of Hiroshima Prefecture defines as “investment.”

Injecting 1.5 trillion yen into semiconductors and maintaining bus routes in remote islands are entirely different in scale and nature. Nevertheless, both are grounded in the same question: “Can we continue to live in this place?” Creating a structure for investments to reach is not about massive funds but about the will to design that delivery—Hiroshima’s two landscapes quietly yet clearly reflect this truth.