The United States Senate is going to vote on a US Innovation and Competition Act of 2021 (USICA) this week. The act, which is expected to pass, will see a US$ 250 billion investment in the nation’s manufacturing and technology sectors as it faces growing rivalry from China.
The New York Times reported on the act on Monday. The article highlighted the key and unique role the Taiwan Semiconductor Manufacturing Corporation (TSMC) plays in supplying high-end chips to both the US and China. It said that US intelligence officials believe that is one reason Xi Jinping might be hesitant to attack Taiwan as the move could destroy China’s strategy in regards to technology and telecommunications.
The global shortage of chips has highlighted the world’s reliance on Taiwan and the need for the US and other countries to manufacture their own. The bill’s budget is intended to strengthen domestic manufacturers and lure foreign firms to open advanced factories in the US. American companies like Micron Technology and Texas Instruments could receive funds due to this act.
In March, Intel said it would invest US$20 billion to build two new factories near Phoenix while TSMC has already started building a plant in the Phoenix area.
The act would also pour money into artificial intelligence, robotics, quantum computing and other key technologies.
Senator Chuck Schumer (D-NY) said he believes China doesn’t believe democracies like the US can unite and funnel their resources into national priorities like this one. The article says the bill’s budget is very similar to that of China’s Made in China 2025 program which they started 6 years ago to work towards independence and leadership in technological innovations. The act has wide bipartisan support as it aims to build up the nation’s industries as it competes with China.