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Governments Pour Billions Into Building Chip Arsenals

Governments around the world are subsidising the construction of semiconductor factories, as chip shortages jam auto production and the electronics industry.

The global dependence on Taiwan and China for vital chip supplies is about to come to an end, but the push is lacking consensus –  especially between the EU, Japan and the USA.

There are now fears of an over-supply of semiconductors from these planned factories, unless governments can come to some agreement on production limits.

The US, the EU and Japan are contemplating spending tens of billions of dollars on cutting-edge chip fabrication plants, as a top US military commander told US lawmakers that a Chinese takeover of Taiwan was the military’s foremost concern in the Pacific.

China has also offered myriad subsidies to its local chip industry as it tries to reduce dependence on western technology.

To counter the concerns, TSMC and Samsung Electronics, the only two chip contract manufacturers capable of making the most advanced computing chips, have drawn up plans for new factories in the US, tempted by around US$30 billion in subsidies.

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