The US will give Taiwanese giant TSMC up to $6.6 billion in direct financing to help build several plants on American soil.
"Today's definitive agreement with TSMC - the world's leading advanced semiconductor manufacturer - will spur $65 billion in private investment to build three state-of-the-art facilities in Arizona," President Joe Biden said in a statement.
The decision by the Biden administration comes about two months before the inauguration of President-elect Donald Trump.
Trump recently criticized CHIPS, a major law passed during Biden's tenure that was intended to strengthen the US semiconductor industry and reduce the country's dependence on Asian suppliers, including Taiwan.
While the US government has released more than $36 billion in grants through this law, including the TSMC grant, much of the funds remain under due diligence and have not been disbursed.
Once a deal is finalized, funds can begin flowing into companies that have met certain milestones.
TSMC is the second company after Polar Semiconductor to finalize its agreement with the US administration.
The first of TSMC's three plants will be fully open in early 2025.
At full capacity, the three Arizona facilities are expected to "produce tens of millions of chips that will power products such as 5G/6G smartphones, autonomous vehicles and high-performance computing systems and artificial intelligence applications," the Commerce Department said.
Years ago, the United States produced nearly 40 percent of the world's chips, now that share is closer to 10 percent—and none of them are cutting-edge chips. | BGNES, AFP
