How the CHIPS Act Could Reshape Cloud Computing Under Trump’s Presidency

Through the CHIPS Act, the Biden administration laid the foundation for a semiconductor manufacturing renaissance, but the fruits of these efforts may be reaped during Donald Trump’s potential return to the presidency. With nearly $450 billion in announced investments across the semiconductor ecosystem, this shift is poised to impact the future of cloud computing—a sector heavily reliant on cutting-edge chips.

Yet, questions remain: Will the ambitious timelines hold? And how will domestic semiconductor production reshape the cloud landscape?

Passed in 2022, the CHIPS Act offers $52 billion in subsidies to boost US semiconductor manufacturing and research. According to a recent report from Business Insider, the initiative secured commitments from major semiconductor players, including Taiwan Semiconductor Manufacturing Company (TSMC), Intel, Samsung, Micron, and SK Hynix.

By August 2024, over 90 manufacturing projects had been announced across 28 states, marking a monumental shift in US tech policy. The Semiconductor Industry Association’s (SIA) 2024 State of the US Semiconductor Industry report predicts that between 2022 and 2032, US semiconductor manufacturing capacity will more than triple, positioning the country as the fastest-growing chip producer globally.

The US’s renewed focus on domestic chip production is also a strategic geopolitical move. China currently dominates the global semiconductor supply chain, particularly in lower-end chips used in consumer electronics. Tensions between the US and China have made semiconductor independence a national security priority. The US Department of Commerce has already imposed export controls on advanced chip technologies to prevent China from accessing critical innovations.

The Biden administration already imposed sweeping export controls on advanced chip technologies to limit China’s access to high-performance computing and AI chips. Trump could expand these measures, further restricting US companies from collaborating with Chinese tech giants like Huawei and ByteDance.

During his first term, Trump’s stance on semiconductors aligns with his broader vision of reducing reliance on foreign supply chains, especially for technologies with national security implications. In 2020, his administration played a major role in pressuring Taiwan Semiconductor Manufacturing Company (TSMC) to build a plant in Arizona—a project now expected to produce 5nm and eventually 3nm chips, key components for advanced cloud computing and AI systems.

Trump’s previous administration emphasized reshoring manufacturing and protecting American industries, suggesting he would likely continue supporting domestic chip production. His policies could further accelerate investments in the sector, particularly if he prioritizes workforce development and infrastructure improvements. Bringing chip production back to the US could reduce vulnerabilities in key sectors, including cloud computing, defense, and telecommunications.

When Trump returns to office, he will likely oversee the semiconductor boom’s critical implementation phase. While Biden laid the groundwork, the manufacturing facilities—and the economic and technological benefits they bring—will materialize during Trump’s presidency. Even more, Trump has previously preferred direct intervention in industrial projects. His administration could accelerate timelines for semiconductor factories by offering additional tax breaks, easing regulatory hurdles, or imposing penalties on companies that delay projects.