US launches microchip import substitution program

The US has launched a program, in fact, import substitution in the field of microchips. They will now be developed and produced in the United States, almost 300 billion dollars have already been allocated for this. The fact is that now microchips are not produced in the States at all, because American companies opened all their factories in Asia. As a result, two-thirds of production in China, a significant part – in Taiwan. And Washington announced this evening that it was launching a new military aid program, this time for Taipei.

On the White House lawn are the heads of the US digital giants. Intel, Lockheed Martin, HP. President Biden signs the Chip and Science Act. And solemnly announces that American semiconductor manufacturers will receive $ 52 billion to build factories in the States and minimize dependence on Asia, where 75 percent of advanced microchips are now produced.

“Unfortunately, now we are producing 0 percent of high-tech semiconductors. China is pulling ahead by developing this industry. At the same time, the Chinese Communist Party is actively setting up American businesses to fight the new law,” Biden said.

The law clearly states: 2 billion dollars to the Ministry of Defense, the same Javelin anti-tank missiles simply will not fly without microchips; 1.5 billion for the promotion and implementation of wireless technologies.

The package includes $39 billion in production stimulus, including $2 billion to upgrade obsolete chips used in cars and defense systems, $13.2 billion in research, development and training. – indicated in the signed document.

Mikron Corporation has already announced its own additional investments – they are investing $40 billion. For the past 30 years, US companies have preferred to open factories in Asia – there is cheap labor, and all patents and copyrights remained with the Americans. As a result, the lion’s share of the market was occupied by Taiwan and South Korea. And now the Congress is asking questions – why will the whole country pay for the return of production to its native harbor?

“Should American taxpayers write a check for billions of dollars at a time when semiconductor companies are making tens of billions by continuing to pay their top managers exorbitant bonuses?” Vermont Senator Bernie Sanders asked.

The United States is playing the role of catching up. According to a Bloomberg study, the fastest growing semiconductor manufacturers that have not sank even during the pandemic are in China. Apple even considered purchasing flash memory for its iPhones there. So Beijing is skeptical about Washington’s attempts to lead the technological race.

“America understands that it is losing in this competition for the ownership of chips. Therefore, Biden issued this bill. But it’s easier said than done. It’s a whole ecosystem: development, research – all components should be taken into account in the creation process. Hundreds of specialists are needed, ” said international strategist Andrew Leung.

The new US “chip” law explicitly prohibits companies receiving federal funding from expanding production in China for 10 years. So the Americans can try to move all their foreign factories to their homeland. Together with valuable employees.

The issue of Taiwan generally plays a special role in this race. This is a frozen conflict that can be used as leverage by the United States – the visit of Speaker Pelosi is a prime example. And China itself, which does not hide plans to fully integrate the rebellious province, even by military means. The law that Biden signed is insurance.

“If the world is divided, if the United States does not manage the global economy, then it is critical for them to get on their territory, or on territory controlled by the United States, for example, in Australia, if we are talking about the Pacific region, those critical products that will ensure stability , the development of the US economy and industry”, – said political scientist Dmitry Solonnikov.

On the other hand, the law on chips and science and the time of its implementation, the next decade, may indicate that the United States is well aware that the risk that Taiwan, as the world’s semiconductor factory, will soon be under the complete control of China, is maximum.