The US government has announced plans to provide $6.6 billion to Taiwan Semiconductor Manufacturing Company (TSMC), the world's largest manufacturer of semiconductor chips, to support the construction of three new fabrication plants in Arizona. This initiative is part of President Joe Biden's strategy to secure the supply of advanced chips and reduce the country's dependence on foreign sources.
President Biden highlighted the importance of domestic chip production, stating that the US has seen a significant decline in its global chip manufacturing capacity over the years. By partnering with TSMC, the US aims to address economic and national security vulnerabilities associated with relying on imported chips.
TSMC, which currently produces around 90% of the world's most advanced chips, will invest over $65 billion in Arizona, marking the largest foreign direct investment in the state's history. The construction of the three new fabs is expected to create approximately 6,000 high-wage tech jobs and over 20,000 indirect jobs in sectors such as construction.
The first fabrication plant is scheduled to begin production in the first half of 2025, providing US customers with access to a local supply of chips that power a wide range of products, including smartphones, satellites, and artificial intelligence systems.
The move to bring more chip production onshore comes in response to supply chain disruptions experienced during the COVID-19 pandemic, which led to delays in chip deliveries and increased consumer goods prices globally. Additionally, concerns about potential trade tensions between the US and China, as well as natural disasters like earthquakes in Taiwan, have underscored the need for a more resilient semiconductor supply chain.
US Commerce Secretary Gina Raimondo emphasized the importance of strengthening domestic supply chain resilience and reducing reliance on foreign sources. The investment in semiconductor manufacturing will enable the US to produce the most advanced chips at scale within its borders for the first time, enhancing the country's technological capabilities and economic security.
