Taiwan Semiconductor Manufacturing Co. (TSMC) today announced plans to build an advanced chip fab in Arizona with the support of the U.S. government.

The deal comes less than a week after The Wall Street Journal reported that White House officials concerned about the nation's reliance on Taiwan had entered into talks with semiconductor manufacturers TSMC and Intel to build chip foundries in the United States.

The $12 billion facility will produce up to 20,000 silicon wafers a month using TSMC's 5-nanometer manufacturing process. The company claims the facility, which will be built in a yet-to-be-disclosed location in Arizona, will employ north of 1,600 people.

TSMC aims to begin construction on the project in 2021 with a completion date targeted for some time in 2024.

"This project is of critical, strategic importance to a vibrant and competitive U.S. semiconductor ecosystem that enables leading U.S. companies to fabricate their cutting-edge semiconductor products within the United States and benefit from the proximity of a world-class semiconductor foundry and ecosystem," the company said in a statement.

While this will expand TSMC's presence in the U.S., The Wall Street Journal reports that even at full capacity the proposed facility would be a drop in the bucket compared to the 12 million wafers it produced last year.

The chip fab won't be TSMC's first facility or even chip fab in the U.S. either. The company operates design centers in Austin, Texas, and San Jose, California, as well as a smaller chip fab in Camas, Washington.

It is also unclear if TSMC will benefit from any financial support from federal, state, or local governments.

Previous bids to attract large international manufacturing companies to the U.S. may shed some light on the lengths the administration is willing to go.

Perhaps the most notable example is the ill-fated Foxconn plant in Mount Pleasant, Wisconsin. In order to secure the factory, which was originally slated to build LCD displays for televisions, then Gov. Scott Walker promised $3 billion to $4.8 billion in subsidies contingent on the company meeting hiring deadlines.

The announcement represents a victory for the Trump administration's "America-first" agenda, in which President Donald Trump has repeatedly pressured U.S. companies to bring manufacturing back home.

The administration is in talks with Intel to build a U.S. chip foundry, however it has yet to make any commitments.

“As the largest U.S.-owned manufacturer of semiconductors, Intel is well positioned to work with the U.S. government to operate a U.S.-owned commercial foundry and supply a broad range of secure microelectronics,” Intel said in statement to SDxCentral.

While bringing semiconductor manufacturers back to the U.S. clearly aligns with the Trump administration's agenda, a recent report from the Boston Consulting Group found that the president appears to be motivated less by a desire to secure U.S. access to vital technologies and instead by efforts to deny China access to U.S. intellectual property.

The report also suggested that any action to restrict access to these technologies would badly damage America's leadership position in the market.

“Over the next three to five years, U.S. companies could lose 8 percentage points of global share and 16% of revenues if the U.S. maintains the restrictions enacted with the current entity list,” the report reads.

The analysts warned that U.S. companies could see revenues decline as much as 37% if the U.S. were to completely ban semiconductor companies from selling to Chinese customers, in effect causing a "technology decoupling from China."