U.S. Government Takes a Cut of Chip Business in Japan-Funded Deal

For years, the United States has tried to jump-start domestic semiconductor production through a mix of federal grants and loans. The Trump administration is taking a much different approach — channeling foreign money into the sector, and demanding a cut for U.S. taxpayers in return.

The latest example was an unusual agreement for a semiconductor factory in upstate New York that was unveiled this week. Billions of dollars in Japanese funding has been dedicated toward building a facility that will be operated by the U.S. chipmaker GlobalFoundries.

But unlike GlobalFoundries’ other factories in New York, the upstate project will be co-owned by the United States and Japan through a special purpose vehicle. Japanese financing of $10 billion is expected to accelerate the construction of the factory, which will begin producing chips for cars, factories and data centers in 2029. Another $10 billion could fund a second plant, if the parties later approve it.

Call it the financialization of government investment. The Japan tie-up is the brain child of President Trump’s commerce secretary, Howard Lutnick, a New York financier known for pursuing unorthodox and aggressive tactics to amass a fortune. In Mr. Trump’s second term, Mr. Lutnick has used the threat of tariffs as a cudgel to drum up big promises of international investment, and turned the Commerce Department into a deal-making operation that wields those funds.

Article source: https://www.nytimes.com/2026/10/23/business/economy/us-japan-chip-deal.html