US government financing for projects to return critical supply chains to the US as part of COVID-19 response efforts could reach tens of billions of dollars and clients might include a projected US$12 billion Taiwanese semiconductor plant, the head of the agency managing the funds said.
The US International Development Finance Corp (DFC) is talking to companies about reshoring the manufacturing of personal protective equipment, generic drugs and pharmaceutical ingredients, chief executive Adam Boehler said in an interview on Monday.
Boehler said letters of understanding for some initial projects could be signed within the next month.
US President Donald Trump’s administration has been pushing for US companies and importers to move manufacturing out of China.
The agency, which opened its doors in January to boost US overseas development financing efforts to counter China’s massive Belt and Road Initiative, was drafted into domestic service last month, after Trump signed an executive order under the Defense Production Act.
DFC and the US Department of Defense on Monday agreed to jointly administer US$100 million in supply chain reshoring funds from the US$2.3 billion coronavirus legislation passed in March.
Company proposals to reshore are already pouring in, Boehler said.
“The areas that have come on hot right away are on the PPE [personal protective equipment] side and within the pharmaceutical value chains,” Boehler said, adding that there was interest in returning some generic drug production to the US.
The US$100 million can be leveraged into “tens of billions of dollars” in loans by using it as a pool of capital similar to the US Department of the Treasury’s backing of US Federal Reserve loan facilities, Boehler said.
At that scale, the agency could participate in the financing of Taiwan Semiconductor Manufacturing Co’s (TSMC, 台積電) planned factory in Arizona.
The project is a centerpiece of the push to wrestle global technology supply chains back from China.
TSMC, the world’s largest contract chipmaker, is a major supplier to Apple Inc, Qualcomm Inc and other major US tech firms.
“We provide loan and investment financing, so could we be relevant there? Absolutely. We’re talking tens of billions of dollars in potential here, so that’s a possibility, I wouldn’t exclude that,” Boehler said.
A financing package for TSMC would likely include private capital from the state of Arizona. It is too soon to say whether the agency would be able to participate.
DFC was created under 2018 legislation that combined the former Overseas Private Investment Corp (OPIC) and part of the US Agency for International Development, more than doubling OPIC’s overall lending and investment capacity to US$60 billion.
Its planned launch in October last year was delayed until January by a budget fight in the US Congress that threatened a government shutdown.
Boehler said the DFC’s development mission would not be affected by Trump’s executive order and would keep its “foot on the nations.
The 337-employee DFC — small for a federal agency — is adding about 15 people to focus solely on the domestic reshoring projects, he said, and the funding for overseas development would be kept separate.
MULTIFACETED: A task force has analyzed possible scenarios and created responses to assist domestic industries in dealing with US tariffs, the economics minister said The Executive Yuan is tomorrow to announce countermeasures to US President Donald Trump’s planned reciprocal tariffs, although the details of the plan would not be made public until Monday next week, Minister of Economic Affairs J.W. Kuo (郭智輝) said yesterday. The Cabinet established an economic and trade task force in November last year to deal with US trade and tariff related issues, Kuo told reporters outside the legislature in Taipei. The task force has been analyzing and evaluating all kinds of scenarios to identify suitable responses and determine how best to assist domestic industries in managing the effects of Trump’s tariffs, he
‘SWASTICAR’: Tesla CEO Elon Musk’s close association with Donald Trump has prompted opponents to brand him a ‘Nazi’ and resulted in a dramatic drop in sales Demonstrators descended on Tesla Inc dealerships across the US, and in Europe and Canada on Saturday to protest company chief Elon Musk, who has amassed extraordinary power as a top adviser to US President Donald Trump. Waving signs with messages such as “Musk is stealing our money” and “Reclaim our country,” the protests largely took place peacefully following fiery episodes of vandalism on Tesla vehicles, dealerships and other facilities in recent weeks that US officials have denounced as terrorism. Hundreds rallied on Saturday outside the Tesla dealership in Manhattan. Some blasted Musk, the world’s richest man, while others demanded the shuttering of his
TIGHT-LIPPED: UMC said it had no merger plans at the moment, after Nikkei Asia reported that the firm and GlobalFoundries were considering restarting merger talks United Microelectronics Corp (UMC, 聯電), the world’s No. 4 contract chipmaker, yesterday launched a new US$5 billion 12-inch chip factory in Singapore as part of its latest effort to diversify its manufacturing footprint amid growing geopolitical risks. The new factory, adjacent to UMC’s existing Singapore fab in the Pasir Res Wafer Fab Park, is scheduled to enter volume production next year, utilizing mature 22-nanometer and 28-nanometer process technologies, UMC said in a statement. The company plans to invest US$5 billion during the first phase of the new fab, which would have an installed capacity of 30,000 12-inch wafers per month, it said. The
Taiwan’s official purchasing managers’ index (PMI) last month rose 0.2 percentage points to 54.2, in a second consecutive month of expansion, thanks to front-loading demand intended to avoid potential US tariff hikes, the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday. While short-term demand appeared robust, uncertainties rose due to US President Donald Trump’s unpredictable trade policy, CIER president Lien Hsien-ming (連賢明) told a news conference in Taipei. Taiwan’s economy this year would be characterized by high-level fluctuations and the volatility would be wilder than most expect, Lien said Demand for electronics, particularly semiconductors, continues to benefit from US technology giants’ effort
RSS