Commerce secretary: Chipmakers moving to other countries ‘will be irreparable’

U.S. Secretary of Commerce Gina Raimondo sits down with Yahoo Finance's Julie Hyman to outline the significance of Congress' CHIPS Act vote and how detrimental it would be to the economy if chip producers moved interest outside of the U.S.

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- US Secretary of Commerce Gina Raimondo sitting down with Yahoo Finance's Julie Hyman as the semiconductor sector waits on a vote on the CHIPS Act. And she discussed her level of confidence that the bill will make it to the president's desk by August.

GINA RAIMONDO: Very high. There's a lot of momentum. Just yesterday I was with probably 80 members of the Congress or more in the secure briefing. A couple of days ago, there were 50 members of the Senate in the similar secure briefing. And when you hear the dialogue, you know they have the sense of urgency. You feel that they're coalescing around getting it done, getting it done soon, focusing on the chips component first, passing that first and letting the conference continue. So there'll be many twists and turns and ups and downs. I promise you that.

I'm willing to say two things. Number one, it's going to get to the president's desk this summer. Number two, there'll be a lot of ups and downs between now and when it does.

JULIE HYMAN: You mentioned that the projects that are going on in other countries. And of course, there are also projects that are impending, imminent here in the United States. What really caught our eye at Yahoo Finance over the past week or so was Pat Gelsinger of Intel tweeting a picture-- I'm sure you're quite familiar with this-- of the site in Ohio where Intel is set to break ground and build a plant but he's waiting for you guys in Washington. So I'm curious what conversations you're having with him and with other leaders in the industry as you're trying to push this across the finish line.

GINA RAIMONDO: He's not alone. He isn't alone. A couple of weeks ago, there's a silicon wafer company called Global Wafers which made an announcement of a $5 billion expansion in Texas. But they said if CHIPS doesn't pass this summer, then instead they'll do it in South Korea.

So in a number of situations-- and the reason, to be clear, it's not that they don't want to wait. It's they can't wait. Semiconductor demand-- demand for these chips is through the roof. And these companies are already at 95% capacity. So the only way to meet demand is to build new factories. And they have to do it now, because it takes a couple of years to build them. So that's why we are at this truly urgent point.

And if Congress doesn't act before they go home for the August recess, I think you will see these companies expand in other countries. And then we're finished. They're only going to make one $20 billion investment in a facility. It's either in America or in Japan, South Korea, France, Germany, Italy. And we have a moment now to pass this in the next couple of weeks. And it's a win for America.

And if we don't, it's a win for China. Make no mistake about it. The Chinese government is lobbying against this bill. They know it's bad for them and good for America. And that's why when you ask me will it get done, I do believe, at the end of the day, these members of Congress are patriots. They are folks who understand what's at stake. And I think they'll do the right thing.

JULIE HYMAN: One of the companies-- just one of the examples that you just cited, GlobalFoundries announcing that it's going to expand in France in particular. With the time that it has taken to get this bill done, has there already been irreversible damage to this push to expand the semiconductor industry in the United States?

GINA RAIMONDO: Yeah. That is such a great question. I would say no. That is a loss that you highlighted. Certainly Intel's big plans in Germany is a loss. Yet I wouldn't put it in the irreparable category. However, if summer comes and goes and this bill doesn't pass, then these companies will move out in other countries. And that will be irreparable, because what happens is when the manufacturing facilities get built someplace else, then the whole supply chain and the talent supply chain also goes somewhere else. All the startups, the suppliers, the chemical companies, the substrate companies, the talent supply will all go to cluster around the big manufacturing facilities. And at that point, that will be truly irreparable. And so that's what's at stake here.