U.S. planned to give $1.5 billion for computer-chip plant

The massive grant, part of the Chips Act, will help the U.S. establish a homegrown supply

In a bid to bolster the nation's capacity for semiconductor production, the Biden administration has revealed plans to allocate $1.5 billion toward the construction of a significant new computer chip factory in New York State. This grant, formally disclosed on Monday, marks the third installment under the Chips and Science Act, a $52 billion initiative initiated by President Biden in 2022 aimed at revitalizing semiconductor manufacturing in the United States, a sector predominantly situated overseas. The allocated funds will assist semiconductor powerhouse GlobalFoundries in establishing a large-scale fabrication facility, commonly referred to as a "fab," at its headquarters in Malta, N.Y., to manufacture advanced chips currently not produced domestically.

The prolonged decline in U.S. chip manufacturing, driven by the pursuit of lower costs abroad, has sparked concerns in Washington regarding the nation's supply chain for these crucial components that underpin modern electronics. While the United States led the development of this technology decades ago, its chip production has lagged, particularly in comparison to China's burgeoning capabilities. Despite U.S.-based plants contributing to 37 percent of global chip production in 1990, their share has dwindled to around 12 percent. Commerce Secretary Gina Raimondo, speaking in a briefing on Sunday, highlighted the Chips Act's transformative investment as a strategy to address the nation's dependence on foreign manufacturers and to establish a domestic pipeline for critical chips vital to American industry and defense.