Biden Administration to Announce Semiconductor Subsidies
According to reports, the Biden administration is gearing up to unveil subsidies worth billions of dollars for major semiconductor companies such as Intel and Taiwan Semiconductor Manufacturing Co. under the $53 billion Chips Act.
Challenges in Implementing the Chips Act
The slow implementation of the bipartisan 2022 Chips Act, frustrated by permitting, negotiations, and worker shortages, has led to only two small grants being awarded out of 170 applications.
Impact on Economic Achievements and Timely Implementation
The expected announcements aim to showcase economic achievements amid the upcoming election season. However, the Chips Act, featuring $39 billion in manufacturing grants and other financial support, faces challenges in timely implementation.
Concerns and Hurdles in Implementation
The delays may impact Biden’s reelection push, and there are concerns about permitting delays and workforce requirements complicating funding negotiations. Additionally, the National Environmental Policy Act, negotiations complicated by unclear program rules, and industry dissatisfaction pose significant hurdles.
Negotiations and Predictability
As negotiations continue, industry experts have stressed the need for predictability to encourage significant investments and global competitiveness.
Stocks Affected by the Development
Other prominent stocks to monitor in light of this development include Samsung Electronics, Micron Technology, and Texas Instruments. Additionally, keep an eye on related ETFs such as the iShares PHLX Semiconductor ETF (SOXX) and the VanEck Semiconductor ETF.
