CHIPS Act: The Leading Edge Gap

With $52.7 billion slated for grants to support Sections 9902 through 9906 of the 2021 National Defense Appropriations Act (NDAA), Washington faces daunting next steps to define and execute on a CHIPS Act program to move the U.S. semiconductor industry toward domestic chip supply chain resiliency and manufacturing and technology leadership over the next five years.

With the growing tensions across the Taiwan Strait, the timeline for achieving domestic supply chain resiliency seems to be increasingly urgent. This is especially true for leading-edge manufacturing as the U.S. continues to trail  Asia. There are nontrivial risks that need to be addressed for Washington’s near- and long-term promises for the CHIPS Act to be realized.

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CHIPS Act: A Vital First Step

The CHIPS and Science Act of 2022, signed Tuesday by President Biden, includes the stated purpose of challenging China’s pursuit of technological and manufacturing leadership in the global semiconductor industry. The bill easily passed both the Senate (64-33) and the House (243-187) with bipartisan support in both houses.

While the passage of the CHIPS Act is a historic achievement that directly addresses the need for chip supply chain resilience add capacity in the U.S., it is also a timely and important commitment to a much longer and comprehensive policy effort to ensure long-term U.S. technology and market share leadership in the vital semiconductor industry.

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