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House Speaker Nancy Pelosi (D-Calif.) will meet with the chairman of Taiwan’s largest semiconductor maker during her visit to the island, a sign of how vital computer chips are to the U.S. economy and national security .
Pelosi and Taiwan Semiconductor Manufacturing Company (TSMC) Chairman Mark Liu will discuss implementation of the recently passed Chip and Science Act, which provides $52 billion in federal subsidies to domestic chip factories, according to people familiar with the matter who spoke on condition of anonymity to discuss Pelosi’s sensitive schedule.
The meeting, scheduled for Wednesday Taiwan time, comes as TSMC is building a chip factory in Arizona and is considering expanding that project to include additional factories at the same site, one of the people said.
Small electronic components are the brains that power all modern electronics. They have been in short supply globally for nearly two years due to rising demand and a shortage of the expensive factories needed to produce the components, leaving countries around the world scrambling to build more production sites.
TSMC is the world’s largest chip maker and a vital supplier to the United States and other Western nations. It is the largest of Taiwan’s chipmakers, which together produce more than 90 percent of the world’s most high-tech chips, according to the Semiconductor Industry Association.
Taiwan official calls for approval of US subsidies for computer chips
The United States uses TSMC-made chips in military equipment, including F-35 fighter jets and Javelin missiles, and in supercomputers at US national laboratories, according to one of the people familiar with the meeting. Major consumer electronics companies, including Apple, also rely on various semiconductors manufactured by TSMC.
U.S. officials have grown alarmed by this dependence in recent years given China’s bellicose rhetoric toward Taiwan, a self-governing democracy that Beijing claims as its territory, although it has never ruled it. Those concerns have led officials and lawmakers to pressure TSMC to build manufacturing facilities in the United States.
In May 2020, TSMC agreed to build a $12 billion factory in Arizona to make five-nanometer transistor chips, a high-tech type of semiconductor used in consumer electronics. By comparison, the average human hair is about 60,000 nanometers thick.
That construction is underway and targeted for completion late next year, on a plot of land in north Phoenix that could accommodate several additional factories. TSMC is now considering expanding its plans to build additional plants at the site, said one of the people familiar with Pelosi’s planned meeting.
In an interview in June, a Taiwanese minister and TSMC board member said the company’s speed of construction in Phoenix would depend on passage of the federal subsidy law that Congress approved last week. President Biden is expected to sign it soon.
One hurdle TSMC faces in Arizona: There aren’t enough trained semiconductor engineers in the area to staff the facility, said minister and board member Ming-Hsin Kung. So the company began sending new employees to Taiwan for training, including professionals with skills in other types of engineering, he said.
About 250 have already traveled for training, including hands-on work at TSMC’s chip factories.
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