Biden to set up taskforce to address semiconductor dearth
The Biden administration will set up a new taskforce to address a number of supply chain issues that threaten the US’ economic recovery from the pandemic, it was announced today.
The first six months of the year have been plagued by disruptions to economic activity brought about by a shortage of semiconductor chips and other supply-and-demand issues.
In one of the most striking cases, the Suez Canal, one of the world’s foremost shipping arteries, was blocked for several days by an out-of-control tanker, costing global trade an estimated $9.6bn a day.
These disruptions, along with booming demand for rare earth metals such as lithium vital to energy transition industries like electric cars, have led some experts to call for nations to onshore supply chains and stockpile resources.
It has been estimated that the shortage in semiconductor chips, which are vital for industries like making cars, could cost manufacturers $110bn this year alone.
According to the US Department of Commerce, the new Supply Chain Disruption taskforce will “provide a whole-of-government response to address near-term supply chain challenges to the economic recovery”.
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It follows a review of critical industries which recommended that Congress approved $50bn in extra spending to boost US semiconductor manufacturing.
At the moment, the semiconductor industry is overwhelmingly centred on Taiwan and South Korea.
The review also said that the US should restore a “national defense stockpile” of critical minerals and materials.
In addition, it recommends that Biden convene a global forum on supply chain resilience with the private sector and various allies.
Commerce secretary Gina Raimondo said: “Semiconductors are the building blocks that underpin so much of our economy, and are essential to our national security, our economic competitiveness, and our daily lives.
“The United States is facing two related crises in supply chains for these critical goods – a short-term shortage and a long-term challenge to U.S. leadership across the semiconductor supply chain and customer base.
“Today’s report takes the first critical step to address both issues, by first providing a comprehensive review of the risks and vulnerabilities in the semiconductor supply chain and laying out a plan to advance long-term U.S. leadership in production and innovation in the semiconductor industry.”