[News] Samsung Receives USD 6.4 Billion Subsidy from US Government, Less than Intel and TSMC

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The US government announced on April 15th that it will provide up to USD 6.4 billion in subsidies to South Korean semiconductor giant Samsung Electronics for expanding advanced chip production capacity at its Texas plant.

The US government previously approved subsidies of up to USD 8.5 billion for US chip giant Intel and USD 6.6 billion for TSMC to alleviate future semiconductor supply constraints. Semiconductors are currently considered the lifeblood of the global economy.

The Department of Commerce stated in a release, “…the U.S. Department of Commerce and Samsung Electronics (Samsung) have signed a non-binding preliminary memorandum of terms (PMT) to provide up to $6.4 billion in direct funding under the CHIPS and Science Act.”

The statement also mentioned that Samsung Electronics is expected to “invest more than $40 billion dollars in the region in the coming years, and the proposed investment would support the creation of over 20,000 jobs.”

US officials told reporters that this subsidy from the “Chips and Science Act” would assist Samsung Electronics in expanding chip production for use in aerospace, defense, and automotive industries, enhancing US national security.

Lael Brainard, the Director of the White House National Economic Council, emphasized that the resurgence of advanced chip manufacturing in the United States signifies a significant milestone for the domestic semiconductor industry.

US Commerce Secretary Gina Raimondo indicated that this subsidy would support two chip production facilities, one R&D fab, and one advanced packaging facility. She mentioned that this subsidy would also help Samsung expand its semiconductor facility in Austin, Texas.

Raimondo further stated, “…this proposed funding advances America’s leadership in semiconductor manufacturing on the world stage.”

Previously, the U.S. government announced that Intel would receive USD 8.5 billion in federal subsidies and USD 11 billion in loans. Intel is planning to invest USD 100 billion across four states in the U.S. for building and expanding fabs, and is also seeking an additional USD 25 billion in tax credits.

On the other hand, US administration is set to provide USD 6.6 billion in aid to TSMC, which plans to build a third chip plant in Arizona with a total investment of USD 65 billion.

Read more

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