Home Technology American tech companies with federal funding are now banned from building factories...

American tech companies with federal funding are now banned from building factories in China for the next 10 years.


Detailed plans have been released by the Biden administration on how it plans to spend $50 billion in budgetary funds under the CHIPS and Science Act. As part of his efforts to boost the US chip manufacturing industry amid a global shortage of microchips, President Biden signed the CHIPS Act into law in early August.

In an effort to restore the US semiconductor industry and maintain national security interests, the CHIPS Act prevents US technology companies receiving federal funds from building new, advanced factories in China for at least ten years.

companies who receive government funding cannot be operating any leading-edge or advanced technology factories in China for a 10-year period, which prohibits companies from building new high-tech facilities in China. This directive only restricts the opening of new leading-edge and advanced factories in China for 10 years, not an expansion of already-established mature technology manufacturing plants.

Among the main objectives of the CHIPS Act, Raimondo said, is to “establish and expand domestic production of advanced semiconductors in the United States” to help reduce reliance on foreign producers like China. “The United States consumes more than 25% of the world’s leading-edge chips, while producing none.”

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