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US-China tensions

US lawmakers weigh $25bn subsidies to boost chipmaking

Washington encourages domestic production as rivalry with China heats up

The Capitol Hill is mulling a $25 billion budget to support the production of semiconductors. (Source photo by Reuters)

WASHINGTON -- U.S. lawmakers are mulling subsidies of about $25 billion to encourage companies to relocate chip production facilities back home amid rising competition with China in the high-tech sector.

It is uncommon for the U.S. to pour big subsidies into any sector, stirring concerns that such direct support could distort the market. But Washington has been keen to protect its own industry on fears that too much outsourcing to China in the high-tech arena could eventually compromise its own national security and military capabilities.

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