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Semiconductors: Biden lands new investment from Taiwanese TSMC

Good economic news, and perhaps political news for American President Joe Biden: Taiwanese semiconductor giant TSMC will build a third factory in Arizona (west), bringing its total investment to 65 billion dollars.

Lael Brainard, Joe Biden's main economic advisor, welcomed on Monday a “new chapter in the history of the semiconductor industry in the United States”.

She clarified, during an exchange with the press, that the investment envisaged by TSMC was based on a preliminary agreement with the Ministry of Commerce, linked to a major law on investment in technologies, the ” Chips and Science Act”.

Under this agreement, the company will receive up to $6.6 billion in direct financing and will be able to benefit from an additional $5 billion in the form of loans.

This law is emblematic of the industrial sovereignty strategy of Joe Biden, who will seek a second term in the November presidential election.

– Shortages –

America wants to protect itself from future shortages of these essential chips in cell phones, electric cars, or advanced military equipment.

< p>So far, the United States is very dependent on Asia for these components, and therefore vulnerable in the event of a geopolitical crisis, particularly in a region as feverish as that of Taiwan, an island over which China claims control. sovereignty.

The United States “does not produce any of the most sophisticated chips, which puts us at significant risk, in terms of the economy and our national security”, commented Joe Biden, quoted in a press release.

“I was determined to change that,” he added, ensuring that thanks to his decisions, “production and jobs in the semiconductor sector (were) making a comeback”.

Semiconductors: Biden lands new investment from Taiwanese TSMC

U.S. President Joe Biden (l) visits the TSMC semiconductor manufacturing plant in Phoenix, Arizona, December 6, 2022 © AFP – Brendan SMIALOWSKI

TSMC, which had already planned two factories in Arizona, will both produce more advanced components than planned in one of them, and add a third site, according to Monday's announcements.

A senior American official indicated that the group was thus increasing its investment from 40 to 65 billion dollars.

“For the first time, we let's mass build the world's most sophisticated semiconductors in the United States,” applauded Gina Raimondo, Minister of Commerce, during a press conference.

– Artificial intelligence –

These extremely miniaturized components “underpin all artificial intelligence technologies,” she stressed.

She assured that TSMC would create “at least 6,000 direct jobs” in these factories, “more than 20,000 jobs” for construction and “tens of thousands of indirect jobs”.

Semiconductors: Biden lands new investment from Taiwanese TSMC

The construction site of a TSMC factory on December 6, 2022 in Phoenix, Arizona © AFP – Brendan Smialowski

TSMC's first factory, which is due to begin producing in large quantities in the first half of 2025, will deliver chips engraved in 4 nanometers (editor's note: a nanometer is equal to a billionth of a meter), according to a press release from the US government.< /p>

The second factory will manufacture even more advanced components, in 3 and 2 nm, while the third will produce some engraved in 2 nm, or even less.

For comparison: the thickness of a sheet of paper is approximately 100,000 nm.

– “Swing state” –< /p>

These investments in Arizona “allow us to better support our American customers, including several champions in the technological field”, Apple for example, commented Mark Liu, president of TSMC, quoted in a press release.

Semiconductors: Biden lands new investment from Taiwanese TSMC

Mark Liu, president of Taiwanese semiconductor giant TSMC, on January 18, 2024 in Taipei © AFP – Sam Yeh

The Taiwanese giant controls more than half of global chip production.

Under pressure from its customers, but also from governments concerned about a possible future invasion of Taiwan by China, TSMC began to diversify its production.

In addition to the United States, it also intends to produce in Japan and Germany.

The “Chips and Science Act”, which dates from the summer of 2022, provides $52.7 billion to revive semiconductor production in the United States, with the idea that public money serves as a springboard for private investments.

The Intel group, for example, recently announced new production capacities in several American states, including, again, Arizona.

This arid land in the West, where the Grand Canyon is located, for example, is one of these decisive states, or “swing states”, where the November election will be played out.< /p>

Joe Biden narrowly won in Arizona in 2020 against former Republican President Donald Trump, who will be his rival again this time.

All rights of reproduction and representation reserved. © (2024) Agence France-Presse

Teilor Stone

By Teilor Stone

Teilor Stone has been a reporter on the news desk since 2013. Before that she wrote about young adolescence and family dynamics for Styles and was the legal affairs correspondent for the Metro desk. Before joining Thesaxon , Teilor Stone worked as a staff writer at the Village Voice and a freelancer for Newsday, The Wall Street Journal, GQ and Mirabella. To get in touch, contact me through my teilor@nizhtimes.com 1-800-268-7116