In the United States, the Chip and Science Act (CHIP-plus) was passed, which should encourage semiconductor manufacturing in the state. That’s why the US has banned tech giants funded by the US government program from expanding production in China. Bloomberg.
It is stated that the new measure will affect the production of microchips smaller than 28 nanometers, that is, the most advanced technologies. According to the agency, companies receiving federal funds will not be able to expand production for 10 years. Companies that violate the restrictions will have to pay back all of the federal subsidies.
It is emphasized that most of the grant will go to major manufacturers such as Intel, Taiwan Semiconductor Manufacturing (TSMC) and Samsung. These companies are currently building new chip manufacturing facilities in the United States. The resolution of Congress already reportedly supports the White House, which will soon sign the law.
Among the grant applicants, only TSMC manufactures next-generation chips in China. The company manufactures 28nm and high-end 16nm chips in the city of Nanjing in southern China. After the law comes into effect, TSMC will not be able to modernize or expand its existing manufacturing facilities in Asia.
Mark Liu, Former President of Taiwan TSMC Semiconductor Company called China “think twice” because of the threat of war. According to him, Chinese officials should consider the possible negative consequences for the global economy following Beijing’s decision to play a power scenario against Taiwan.