U.S. President Biden says chip factory in South Korea to be a model for American factories
by Associated Press
A semiconductor shortage last year hurt the availability of autos, kitchen appliances and other goods, causing higher inflation worldwide and crippling Biden's public approval among U.S. voters.
President Joe Biden opened a trip to Asia on May 20th by touring a South Korean computer chip factory that will be the model for another plant in Texas, offering it as a way to deepen ties with the Indo Pacific and fuel technological innovation and foster vibrant democracies.
“So much of the future of the world is going to be written here, in the Indo Pacific, over the next several decades,” Biden said. “This is the moment, in my view, to invest in one another to deepen our business ties, to bring our people even closer together.”
Biden’s message was pitched toward the promise of a better tomorrow, yet was also aimed at U.S. voters amid political challenges at home, such as inflation driven higher by the chip shortage, as he tries to show that his administration is delivering on economic growth.
The Democrat’s first visit to Asia as president came as polling released on May 20 by The Associated Press-NORC Center for Public Affairs Research found Biden’s U.S. approval rating at 39%, the lowest point of his presidency. The survey also found deepening pessimism about the economy and the state of the United States — especially among Democrats.
Samsung, the chip plant’s owner, last November announced plans to open a $17 billion semiconductor factory in Texas. A semiconductor shortage last year hurt the availability of autos, kitchen appliances and other goods, causing higher inflation worldwide and crippling Biden’s public approval among U.S. voters. The president noted that the Texas plant would add 3,000 high-tech jobs and the construction would include union labor.
“These little chips,” Biden said in remarks after he toured the plant, “are the key to propelling us into the next era of humanity’s technological development.”
Biden was seeking to frame business collaboration and foreign investment in the U.S. as part of his broader economic goals, and also good for him domestically. He was to appear on May 22 in Seoul, South Korea, with the chairman of Hyundai Motor Group on Hyundai’s decision to invest in a new electric vehicle and battery manufacturing facility in Savannah, Georgia.
Throughout the five-day visit to South Korea and Japan, Biden will grapple with a multitude of foreign policy issues as he tries to explain their relevance to the American public. In his remarks on May 20th, Biden did not mention China, which has emerged as a prime competitor with the U.S., yet he stressed the value of alliances that currently exclude that country.
Part of the computer chip shortage is the result of strong demand as much of the world emerged from the coronavirus pandemic. But coronavirus outbreaks and other challenges also caused the closure of semiconductor plants. U.S. government officials have estimated that chip production will not be at the levels they would like until early 2023.
Global computer chip sales totaled $151.7 billion during the first three months of this year, a 23% jump from the same period in 2021, according to the Semiconductor Industry Association.
More than 75% of global chip production comes from Asia. That’s a possible vulnerability the U.S. hopes to protect against through more domestic production and $52 billion worth of government investment in the sector through a bill being negotiated in Congress.