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US lawmakers to open chips, China Bill negotiations

US lawmakers to open chips, China Bill negotiations

FILE PHOTO: A researcher plants a semiconductor on an interface board during a research work to design and develop a semiconductor product at Tsinghua Unigroup research centre in Beijing, China, February 29, 2016. REUTERS/Kim Kyung-Hoon

WASHINGTON: Members of Congress will meet Thursday (May 12) to open negotiations on a compromise measure that would fund US$52 billion in semiconductor manufacturing subsidies and boost US competitiveness with Chinese technology, a source told Reuters.

The Senate passed its version of the bill in June 2021, while the House passed a similar Bill in February. More than 100 House and Senate lawmakers have been named to a "conference committee" that will meet for the first time Thursday. Congressional aides said it could still take months before a final agreement is reached.

A persistent shortage of chips has disrupted the automotive and electronics industries, forcing some firms to scale back production.

"It's crazy it's taken this long," Senator Mark Warner told Reuters on Thursday. He noted that since the United States began considering incentives, other countries like Germany have announced and finalised new chips incentives.

Warner said some major investments in new US chip production could be jeopardised without action from Congress.

On Wednesday, the Senate made more than two dozen motions to instruct negotiators on a range of issues.

Although the motions were not binding, they convey a sense of what senators would like to see in the final Bill and what could keep it from getting enough votes to become law.

The Senate Bill approved in June had US$52 billion for chips and authorised another US$200 billion to boost US scientific and technological innovation, but then stalled in the House.

The House passed a version in February that had US$52 billion in chips funding but significant differences on other science and technology provisions.

That measure included a number of trade proposals not in the Senate Bill. The House Bill would also impose additional sanctions on China for its treatment of Uyghurs.

Source: Reuters/gs

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