The US will allocate USD 6.6 billion. for the production of microprocessors. They want to reduce geopolitical risk

Luc Williams

Thanks to this financing, the American branchł Taiwan Semiconductor Manufacturing Company (TSMC), which is building two production plants in Phoenix, will be able to build a third one in parallel, the AP reported on Monday. According to U.S. authorities, full-scale production at the first of these plants is expected to start by mid-2025.

In addition, the US Ministry of Commerce will offer TSMC low-interest government loans for a total amount of up to USD 5 billion, Reuters added.

“All artificial intelligence is based on these microprocessors,” the head of the Ministry of Commerce, Gina Raimondo, said in a statement, emphasizing that the chips are “essential technology components needed by our economy” and their role in defense and security is “critical.”

Financing the plants in Arizona is possible thanks to the CHIPS and Science Act adopted two years ago, which provides for investing $280 billion in technology development. The US hopes that this will minimize the risk of disruptions in microprocessor supply chains that occurred during the pandemic.

Raimondo said that in 2030, after the factories built in Arizona are fully operational, the United States will account for 20 percent. world production of the most technologically advanced microprocessors. Currently, they are mainly being created in Taiwan, to which China claims, considering this country an “inalienable” part of its territory. Beijing is seeking to take control of the island, without ruling out the possibility of using force. In recent years, China has increased military pressure, sending warships and military planes near Taiwan almost daily.

Taiwan's absolute dominance in microprocessor production has been dubbed the island's “silicon shield.” Some observers fear that increasing chip production outside Taiwan is tantamount to exporting fragments of the “shield” abroad. To counteract this, Taiwan adopted its own chip law, providing favorable tax breaks to companies conducting research in the field of microprocessors. According to the Ministry of Economy in Taipei, the construction of plants in Arizona will not result in a loss of advantage also because some of the production of the most advanced elements will still be carried out on the island. (PAP)


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