It has been reported that the U.S. Joe Biden administration is discussing a plan to provide subsidies worth 13 trillion won to Intel, a U.S. semiconductor company. It is interpreted that ahead of the US presidential election in November, the government is providing large-scale support to domestic companies first, ahead of Samsung Electronics and TSMC.
On the 16th (local time), Bloomberg News, citing sources familiar with discussions on subsidy payments under the Semiconductor Act, reported that the amount the U.S. government is considering providing support to Intel is more than $10 billion (approximately 13.355 trillion won). The Semiconductor Act aims to provide direct subsidies of $39 billion and loan support worth $75 billion to companies building factories in the United States in order to attract cutting-edge semiconductor production bases centered on Korea, Taiwan, and China to the United States. If paid to Intel as reported, it will be the largest subsidy since the implementation of the Semiconductor Act in 2022.
Previously, Minister Gina Lemondo told Reuters on the 5th of this month that they were negotiating with major semiconductor companies regarding the size of subsidies, and that “we will see some announcements in the next 6 to 8 weeks.”
Samsung Electronics also completed its application for subsidies from the U.S. government in the second half of last year (July to December). After conducting due diligence on the company, negotiations are still ongoing regarding the size of the subsidy and timing of payment. Samsung Electronics is investing approximately $17 billion (approximately 22.7 trillion won) to build a foundry (semiconductor consignment production) plant in Taylor, Texas. Construction is underway with the goal of operating within the year.
Related industries are concerned that if former President Donald Trump returns to power, he may change his policy to focus support on domestic companies instead of the existing semiconductor law. Former President Trump also targeted Taiwan’s TSMC, saying, “Taiwan has taken over the United States’ semiconductor industry and is currently monopolizing up to 90% of the production volume.”
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Source: Donga
Mark Jones is a world traveler and journalist for News Rebeat. With a curious mind and a love of adventure, Mark brings a unique perspective to the latest global events and provides in-depth and thought-provoking coverage of the world at large.