The world’s third-largest semiconductor wafer maker, Taiwan’s GlobalWafers, on Monday announced plans to build a $ 5 billion plant in the U.S., but only if the government helps pay for it.
“This investment they are making depends on the passage of the CHIPS Act Congress [GlobalWafers] The CEO told me herself, and they reiterated it today, “U.S. Secretary of Commerce Gina Raimondo told CNBC the same day GlobalWafers announced its development plan.
In fact, Congress passed the CHIPS Act, which proposed $ 52 billion in funding for local players to invest in the national chip industry in January 2021 as part of that national defense clearance law. year, an annual bill designed to provide policy guidance and funding for the course. But more than a year later, Congress has not yet formally allocated any budget to fund the bill.
“It simply came to our notice then [Congress goes] until the August recess. I don’t know how to put it more clearly. [The GlobalWafers] The agreement … will disappear, I think, if Congress does not act, “Raimondo told CNBC.
The CHIPS Act aims to strengthen the chip industry pouring into the United States as a hedge against China’s accelerated development of its own semiconductor capabilities and moving global production away from China’s coasts. Most of the world’s semiconductor manufacturing is consolidated in Taiwan, an independent island over which Beijing claims sovereignty.
Technically, the CHIPS Act is supposed to support domestic companies, not foreign companies investing in America. But last December, the U.S.-based semiconductor industry organization SEMI urged Congress to open up CHIPS funding to all companies investing in the U.S.
Taiwan’s GlobalWafers, which has proposed building its new plant in Texas, is not the only chip maker to have conditioned its U.S. investment on government funding.
In 2020, Taiwan Semiconductor Manufacturing Corp. (TSMC), the world’s largest contract chip maker, announced plans for a $ 12 billion plant in Phoenix, Arizona, to produce its most advanced chips. But TSMC CEO Mark Liu made it clear that development would only go ahead if the government could “offset the difference in TSMC’s operating costs between the United States and Taiwan.”
The story goes on
The state of Arizona approved 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 said construction of its Arizona plant, which is underway, turned out to be more expensive than the company anticipated, and called on Washington to extend CHIPS support to foreign companies.
Of course, national actors want the government to help them subsidize their own expansions in the US as well. Last week, Intel froze the construction of its last $ 20 billion factory in Ohio and postponed its initiation ceremony indefinitely, or until Congress funded the CHIPS Act.
“Unfortunately, funding for the CHIPS Act has advanced more slowly than we expected and we still don’t know when it will be done,” Intel spokesman Will Moss told the Wall Street Journal, asking Congress to act so that Intel “can moving forward at the speed and scale we have long imagined for Ohio. “
This story was originally presented on Fortune.com