US to discuss new chips law with Taiwan next month

TAIPEI – The United States will hold talks with Taiwan next month to discuss new US legislation designed to boost the American semiconductor industry, the top US diplomat in Taipei said on Wednesday.

Last month, US President Joe Biden signed into law the Chips and Science Act, which authorised about US$52 billion (S$73 billion) in government subsidies for US semiconductor production and research, as well as an investment tax credit for chip plants estimated to be worth US$24 billion.

The United States has been encouraging foreign tech firms to manufacture in the country, and the US government has welcomed investments by the Taiwan Semiconductor Manufacturing Company (TSMC) and Taiwan’s GlobalWafers.

Ms Sandra Oudkirk, director of the American Institute in Taiwan, told an industry forum that the US-Taiwan Technology Trade and Investment Collaboration framework, or TTIC, has helped elevate and prioritise US-Taiwan economic engagements.

“The TTIC is a powerful platform which we are already using to address challenges in the semiconductor space, such as critical chip shortages which adversely affect multiple industry sectors,” she said of the framework, which was launched last year.

The next “engagement” under the framework will happen in Washington from Oct 12 to 14, she added.

“At this event, we plan to host a roundtable discussion to share more on how the Chips and Science Act will be implemented in the United States,” Ms Oudkirk said, without elaborating.

“In addition to Taiwan investments in hardware and technology via the incentives provided by the Chips and Science Act, the United States seeks Taiwan’s industry’s continued support as we connect talent here and the innovative ecosystem here to the United States and other like-minded partners.”

Taiwan has been keen to show the US, its most important international backer and arms supplier despite the lack of formal diplomatic ties, that it is a reliable friend as a global chip crunch continues to impact auto production and consumer electronics.

TSMC, a major Apple supplier and the world’s largest contract chipmaker, is constructing a US$12 billion plant in the US state of Arizona. REUTERS