US plans to require 1:1 ratio of domestically made to imported chips, WSJ reports
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The US is planning to ask chip companies to make the same number of semiconductors domestically as their customers import from producers abroad.
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Bengaluru – The United States is planning to ask chip companies to manufacture the same number of semiconductors domestically as their customers import from overseas producers, the Wall Street Journal reported on Sept 26.
Companies that do not maintain a 1:1 ratio over time would have to pay a tariff, the report said, citing people familiar with the plan.
President Donald Trump said in August his administration would impose a tariff of about 100 per cent on imports of semiconductors but it would not apply to companies that were manufacturing in the US or had committed to do so.
The move, tied to his efforts to revive US manufacturing, has motivated international companies to invest more, sending billions into the country.
US Commerce Secretary Howard Lutnick floated the idea with semiconductor executives, telling them it might be necessary for economic security, the Journal said.
It cited White House spokesperson Kush Desai as saying: “America cannot be reliant on foreign imports for the semiconductor products that are essential for our national and economic security.”
Under the plan, a company pledging to make chips in the US would receive credit for that pledged volume, allowing it and its customers to import without tariffs until the plant is completed, with initial relief to help firms ramp up capacity, the report said. REUTERS
