August 19, 2022

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Chip makers refuse to build new semiconductor plants in the US unless Congress unlocks $52 billion in funding

Chip makers refuse to build new semiconductor plants in the US unless Congress unlocks $52 billion in funding

The world’s third largest semiconductor chip maker, Taiwan’s GlobalWafers, announced plans to build a A $5 billion plant in the US on Monday — but only if the government helps pay for it.

“This investment they are making is conditional on Congress passing CHIPS.” [GlobalWafers] The CEO herself told me, and I reiterated that day,” US Commerce Secretary Gina Raimondo told CNBC, on the same day GlobalWafers announced its development plan.

Indeed, Congress Passed successfully CHIPS Act, which proposed $52 billion in Finance For domestic players to invest in the domestic chip industry, in January 2021 as part of that year’s National Defense Authorization Act – an annual bill designed to provide policy and financing guidance for this year. But, more than a year later, Congress has not allocated any official budget to fund the bill.

“It must be done before [Congress goes] Until the August holiday. I don’t know how to say it anymore clearly. [The GlobalWafers] A deal… it’s going to go away, I think, if Congress doesn’t act,” Raimundo told CNBC.

CHIPS aims to support America’s struggling chip industry as a hedge against China’s accelerating development of its semiconductor capabilities and diverting global production away from China’s shores. The majority of global semiconductor manufacturing unified in taiwanAn independent island over which Beijing claims sovereignty.

Technically, CHIPS is supposed to support domestic companies — not foreign companies investing in America. But, last December, the US-based semiconductor industry organization urge Congress will open CHIPS funding to all companies investing in the United States

Taiwan’s GlobalWafers, which has proposed building its new plant in Texas, isn’t the only chipmaker that has tied its US investment to government funding.

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in 2020, Taiwan Semiconductor Manufacturing Corp. (TSMC), the world’s largest chip maker, has announced plans to build a $12 billion plant in Phoenix, Arizona, to produce its most advanced chips. But TSMC CEO Mark Liu explain it Development will only continue if the government can “compensate for the difference in operating costs of TSMC between the United States and Taiwan”.

Arizona agreed At least $200 million in public infrastructure funding to support TSMC’s plant operations in Phoenix, including spending on roads and sewer systems. In June, TSMC He said Construction of the Arizona Fab plant, still underway, has proven more costly than the company expected, and Washington has called for expanded CHIPS support to foreign companies.

Of course, domestic players want the government to help support their expansions in the US as well. last week, Intel Corporation Put freeze on building its newest $20 billion plant in Ohio and has postponed the groundbreaking ceremony indefinitely — or until Congress funds CHIPS.

Intel spokesperson Will Moss said: The Wall Street Journalasking Congress to act so that Intel can move forward at the speed and scale we have long envisioned in Ohio.

This story originally appeared on Fortune.com