Authorities in Phoenix, Arizona, have agreed to support Apple’s chip-supplier, Taiwan Semiconductor Manufacturing Co (TSMC), set up a $12 billion chip manufacturing plant. In Wednesday’s notice, the City Council authorized financing from its public infrastructure pool to support the project.

What Happened: Phoenix authorities expect that the Taiwanese chipmaker’s advanced semiconductor fabrication campus could generate 1,900 new jobs over the next five years. Production is scheduled to begin in 2024.

With the new plant in operation, the council estimates a direct economic contribution, in terms of output, of approximately $38.2 billion over the next 20-year period and a boost in annual personal income by $314 million.

The council will fund roughly $205 million for infrastructure projects that support TSMC’s plant. It will spend an estimated amount of $61 million on road connectivity, $37 million on public water infrastructure, and $107 million on sewers and public wastewater infrastructure.

An on-site professional team will also be available.

Why Does It Matter: TSMC approached Phoenix authorities with the project in May 2020. According to Bloomberg, outgoing-President Donald Trump’s China-bashing and warnings over manufacturing electronics outside the U.S. did have a generic impact on the city council’s decision.

Separately, another Apple-supplier, Hon Hai Precision Industry Co, or Foxconn, engaged with Wisconsin State officials since 2017 for a $10 billion plant in the city, per Apple Insider. However, the LCD manufacturing plant’s fate was uncertain after a disagreement between state officials and Foxconn’s management. Expectedly, Foxconn completed making its first batch of LCDs in a manufacturing plant in Vietnam.

Price Action: TSM shares were 0.29% lower at $96.65 in the pre-market session on the last check Thursday.

This story originally appeared on Benzinga.

© 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

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