President to Tackle Global Semiconductor Chip Shortage

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President Joe Biden plans to sign an executive order soon to address the global shortage of semiconductor chips, used in telecom, health care, transportation and other sectors. The chip and tech industry overall have been raising the alarm on the issue.

The Semiconductor Industry Association, which includes Broadcom, Qualcomm, IBM and others, Thursday emphasized the role of chips in a letter to Biden. It detailed the role of semiconductors to help pull the country out of the pandemic, including improving broadband access and infrastructure.

“Semiconductor-enabled technologies have aided researchers in developing life-saving vaccines and helped Americans work and learn remotely,” the board of directors wrote. Without more investment, they cautioned, foreign adversaries making strides in semiconductor manufacturing and research may upstage the U.S. in fields like 5G, AI and quantum computing.   

Biden’s order calls for a supply chain review and developing a long-term strategy to avoid future shortages, according to Bloomberg. The administration is “currently identifying potential chokepoints in the supply chain” and working with industry and trading partners to make progress on the problem, White House press secretary Jen Psaki said during a Thursday briefing. “The long-standing issue with short supply of semiconductors … is one of the central motivations for the executive order the president will sign.” She noted that would happen “in the coming weeks.”

The upcoming order will entail a “comprehensive review of supply chains for critical goods,” according to Psaki — one that may begin to ease industry concerns about the slowing of domestic chip production, Politico reported. The review will be “focused on identifying the immediate actions we can take, from improving the physical production of those items in the U.S., to working with allies to develop a coordinated response to weaknesses and bottlenecks that are hurting American workers.”

The Semiconductor Industry Association suggested one idea in a letter to Biden. The group urged the administration to include “substantial funding for incentives for semiconductor manufacturing, in the form of grants and/or tax credits, and for basic and applied semiconductor research,” in the upcoming stimulus package. But it’s unclear if the administration intends to do that, noted The Verge.

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