The U.S. government allocates $1.5 billion to GlobalFoundries for domestic expansion in New York and Vermont under the 2022 CHIPS and Science Act.
Commerce Secretary Raimondo emphasizes the chips' significance in powering military equipment, electric vehicles, smartphones, and internet connections.
GlobalFoundries plans to use funds to expand output, create jobs, and revitalize plants, expecting to generate thousands of jobs over a decade.
The US government plans to give the computer chip manufacturer GlobalFoundries $1.5 billion to increase its domestic operations in New York and Vermont, the Biden administration said on Monday.
(Photo : by Chip Somodevilla/Getty Images)The US government plans to give the computer chip manufacturer GlobalFoundries $1.5 billion to increase its domestic operations in New York and Vermont, the Biden administration said on Monday.
With this news, a semiconductor manufacturer receives direct financial support for the third time under the 2022 CHIPS and Science Act. The measure allows the government to spend more than $52 billion on research and development as well as reviving computer chip production in the US.
Commerce Secretary Gina Raimondo emphasized the significance of the chips to be manufactured in GlobalFoundries' new facilities during a call with reporters, stating, "They power sophisticated military equipment, electric vehicles. They assure smartphones have the latest features, enable faster Internet connections for Americans."
Along with the direct funding, the government would also lend up to $1.6 billion; the anticipated total of public and private investment is around $12.5 billion.
As part of a strategic agreement with General Motors, GlobalFoundries plans to utilize the funds to expand output at its current plant in Malta, boost employment at its new advanced chip factory under development in Malta, New York, and rejuvenate its plant in Burlington, Vermont.
Over the following ten years, the projects are anticipated to generate 9,000 construction employment and 1,500 manufacturing jobs. The agreement stipulates that $10 million would go toward worker training, and that construction workers will now be eligible for GlobalFoundries' $1,000 yearly subsidy for child care and child care support services.
The bill allowing the funding of chip manufacturing was drafted by Senate Majority Leader Charles Schumer, D-N.Y., who said that technology was just as important to the American economy and national security as food. In an interview with The Associated Press, he stated that interruptions might potentially affect the United States, similar to what happened during the coronavirus epidemic when auto companies were unable to produce enough chips to continue manufacturing cars.
The state of the American economy has been a huge worry since there is a significant election this year that will determine who will control Congress and the White House. Republicans in Congress have emphasized that the 2022 peak inflation rates have reduced family purchasing power, which is an urgent pressure point that has harmed President Joe Biden's standing.
However, Democrats have emphasized their attempts to lower inflation as well as the long-term expenditures, including infrastructure and computer chip manufacturing, that they believe would spur future prosperity.
Additionally, Schumer said that the efforts, which drew some support from both parties, demonstrated the Democrats' focus on making long-term investments in the nation.
