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End of the crisis? US proposes to subsidize chip industry • ENTER.CO

The semiconductor shortage, which has been plaguing the chip industry for several months, appears to be seeing an abatement. Adding to low demand due to the slowing economy and the war in Ukraine, the US is now about to pass a subsidy package for manufacturers.

The main chip manufacturers in the US agreed with the bill that is currently in the Senate of that country that contemplates subsidies for this sector. At first there was a strong rejection in view of the fact that it was only benefiting the company Intel Corp. The objective of the new legislation is to give a boost to the chip industry in the United States. This as a measure to face the rapid expansion of countries such as China, which in the last five years grew to become a benchmark of almost 10% of global chip sales.

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If the new legislation is approved, as it is formulated, 52 million dollars in subsidies and an investment tax credit would be activated. This is intended to boost chip manufacturing in the US and also address the industry’s semiconductor crisis. Last week this legislation was in the midst of controversy. Chip designers such as Advanced Micro Devices Inc (AMD.O), Qualcomm Inc (QCOM.O), and Nvidia Corp (NVDA.O) claimed that the final language of the legislation provided disproportionate support to manufacturers such as Intel. It is important to know that this bill has bipartisan support. A couple of days ago, Republican Senator John Cornyn tweeted giving the proceedings a “green light” after Democrats scaled back their ambitions on unrelated spending bills.

Image: Chris Ried on Unsplash

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