Pointers at Glance
- Biden Administration releases plan for dispensing $50 billion investment in chips.
- The aim is to build the domestic semiconductor industry. The investments will reduce dependency on a foreign supply chain.
The Department of Commerce released its plan for dispensing $50 billion aimed at building up the domestic semiconductor industry and countering China, in what is expected to be the biggest United States government effort in decades to form a strategic industry.
Nearly $28 billion of the so-called CHIPS for America Fund is anticipated to go toward grants and loans to help build facilities for making, assembling and packaging some of the more advanced chips in the world.
Another $10 billion will be devoted to expanding manufacturing for older generations of technology used in cars, communications technology, specialty technologies, and other industry suppliers. In comparison, $11 billion will go toward research and development initiatives related to the industry.
In an interview, Gina Raimondo, the secretary of commerce, said that the department aims to start soliciting applications for funding from companies no later than February. It could begin disbursing money by next spring.
The fund, approved by Congress in July, was created to encourage US production of strategically essential semiconductors and spur research & development into the next generation of chip technologies.
The Biden administration says the investments will reduce dependence on a foreign supply chain that has become an urgent threat to the country’s national security.
Ms. Raimondo said that this is a once-in-a-lifetime opportunity, a once-in-a-generation opportunity, to secure national security and revitalize American manufacturing, American innovation, research and development.
Trade experts have called the fund the most significant investment in an industrial policy that the United States has made in at least 50 years. It will come at a crucial moment for the semiconductor industry. The Biden administration has also taken steps to restrict advanced semiconductors and equipment that can be exported out of the United States.