US President Donald Trump’s pick to lead the agency in charge of a US$52 billion semiconductor subsidy program declined to give it unqualified support, raising questions about the disbursement of funds to companies like Intel Corp and Taiwan Semiconductor Manufacturing Co (台積電).
“I can’t say that I can honor something I haven’t read,” Howard Lutnick, Trump’s nominee for commerce secretary, said of the binding CHIPS and Science Act awards in a confirmation hearing on Wednesday. “To the extent monies have been disbursed, I would commit to rigorously enforcing documents that have been signed by those companies to make sure we get the benefit of the bargain.”
Still, Lutnick signaled a commitment to the program overall. He told senators that the CHIPS Act is an “excellent down payment” and repeatedly emphasized the importance of revitalizing US semiconductor manufacturing.
Photo: EPA-EFE
All told, his remarks indicate that the Trump administration will seek to put its own stamp on the initiative, but not unravel it entirely.
That could include attempts to remove environmental requirements or labor-friendly provisions, as some Republican lawmakers have already signaled an interest in doing.
The CHIPS Act set aside US$39 billion in grants for manufacturing projects — plus loans and tax breaks — to boost US chipmaking after decades of production shifting to Asia.
The program is one of the largest pieces of US industrial policy in more than a generation and was a major achievement of former US president Joe Biden’s administration.
Companies pledged to invest more than US$400 billion in response, including major new projects from Micron, Samsung Electronics Co and GlobalFoundries Inc. Those chipmakers are among the 20 companies that signed final contracts with the Biden administration — documents that industry and government officials generally viewed to be ironclad.
However, throughout negotiations, some companies worried that the language of their contracts gives Trump officials some room to make changes, Bloomberg has reported.
So far, just US$4.3 billion in manufacturing incentives has actually gone out the door. That is because companies will only receive money when they hit key construction and production benchmarks.
“As a structure, I think we need to get it right,” Lutnick said on Wednesday when asked about the awards. “I think we need to review them and get it right. But as the way the Congress has set it, it’s an excellent down payment in our ability to bring semiconductor manufacturing back to America.”
Lutnick also dismissed concerns about Trump’s proposed federal funding freeze causing delays for the CHIPS Act initiative. The program “has not really distributed much money, so the timing is not really impacted,” he said, adding that he is committed to “deliver efficiently and effectively the outcomes that you anticipated — or better.”
Semiconductor business between Taiwan and the US is a “win-win” model for both sides given the high level of complementarity, the government said yesterday responding to tariff threats from US President Donald Trump. Home to the world’s largest contract chipmaker, Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), Taiwan is a key link in the global technology supply chain for companies such as Apple Inc and Nvidia Corp. Trump said on Monday he plans to impose tariffs on imported chips, pharmaceuticals and steel in an effort to get the producers to make them in the US. “Taiwan and the US semiconductor and other technology industries
SMALL AND EFFICIENT: The Chinese AI app’s initial success has spurred worries in the US that its tech giants’ massive AI spending needs re-evaluation, a market strategist said Chinese artificial intelligence (AI) start-up DeepSeek’s (深度求索) eponymous AI assistant rocketed to the top of Apple Inc’s iPhone download charts, stirring doubts in Silicon Valley about the strength of the US’ technological dominance. The app’s underlying AI model is widely seen as competitive with OpenAI and Meta Platforms Inc’s latest. Its claim that it cost much less to train and develop triggered share moves across Asia’s supply chain. Chinese tech firms linked to DeepSeek, such as Iflytek Co (科大訊飛), surged yesterday, while chipmaking tool makers like Advantest Corp slumped on the potential threat to demand for Nvidia Corp’s AI accelerators. US stock
The US Federal Reserve is expected to announce a pause in rate cuts on Wednesday, as policymakers look to continue tackling inflation under close and vocal scrutiny from US President Donald Trump. The Fed cut its key lending rate by a full percentage point in the final four months of last year and indicated it would move more cautiously going forward amid an uptick in inflation away from its long-term target of 2 percent. “I think they will do nothing, and I think they should do nothing,” Federal Reserve Bank of St Louis former president Jim Bullard said. “I think the
Cryptocurrencies gave a lukewarm reception to US President Donald Trump’s first policy moves on digital assets, notching small gains after he commissioned a report on regulation and a crypto reserve. Bitcoin has been broadly steady since Trump took office on Monday and was trading at about US$105,000 yesterday as some of the euphoria around a hoped-for revolution in cryptocurrency regulation ebbed. Smaller cryptocurrency ether has likewise had a fairly steady week, although was up 5 percent in the Asia day to US$3,420. Bitcoin had been one of the most spectacular “Trump trades” in financial markets, gaining 50 percent to break above US$100,000 and
RSS