Arizona Republican Gov. Doug Ducey recently talked to the governors of North Dakota and Virginia at the National Governors Association gathering in Maine about the importance of passing the CHIPS for America Act.
“Spoke with Gov. @DougBurgum and Gov. @GlennYoungkin about the need for Congress to finally pass the CHIPS Act and address the global chip shortage,” Ducey wrote in a Twitter post. “In Arizona, we’ve amped up skills training and created the right environment for semiconductor companies to take root.”
The CHIPS Act is a competitiveness bill that was part of the Fiscal Year 21 National Defense Authorization Act (NDAA), according to the Semiconductor Industry Association (SIA). The legislation acknowledges that the U.S. semiconductor industry will play a key role in the country's future that calls for semiconductor manufacturing and research. The U.S. Senate passed its version of the bill last June, including $52 billion in investments in semiconductor-related provisions. The House of Representatives passed its version in February, also including $52 billion in investments.
“Getting semiconductor industry policy right should be a major focus of U.S. policymakers, starting of course with passage of the CHIPS Act funding bill and then establishing a new office and process for administering the funding, and working with allies to avoid a subsidy race,” China expert Paul Triolo said in an interview with the Center for Strategic and International Studies (CSIS). “This is a sector that the U.S. should pay attention to, by creating and funding incentives that are sustainable and built for the long term.”
China has been growing in global chip sales from 3.8% in 2017 to 9% in 2020, worth $13 billion and $39.8 billion in sales, respectively, the SIA reports. SIA predicted that if China continues its trajectory, it will account for at least 17.4% of global chip sales in 2024, generating around $116 billion in revenue.
U.S. Commerce Secretary Gina Raimondo told CNBC that Taiwan-based semiconductor silicon wafer firm GlobalWafers recently announced plan to construct a facility in Texas is likely dependent on the passage of the CHIPS Act.
“This deal … will go away, I think, if Congress doesn’t act,” Raimondo said. “Semiconductor demand is going to double in the next 10 or 11 years. It takes a couple of years to get a new facility up and running, which means these companies have to make their decisions now.”
The SIA stated House and Senate must now reach an agreement on the legislation, which will then be sent to President Joe Biden's desk.