The EU is to publish early next month proposed legislation to make the continent a leader in chip production, European Commission President Ursula von der Leyen announced yesterday.
The European Chips Act would further adapt state aid rules “under a set of strict conditions,” the head of the EU’s executive arm said during a virtual address at the World Economic Forum.
“This will allow public support — for the very first time — for European ‘first of a kind’ production facilities so that benefit all of Europe,” she said.
Photo: Reuters
The EU wants to become more involved in chip production, with a target of producing 20 percent of global semiconductor value by 2030, up from 10 percent.
Currently, the EU is a world leader on chip research and production equipment, but lags behind in producing chips, particularly state-of-the-art versions. A global supply shortage of semiconductors highlighted the continent’s dependence on Asia and the US.
Most of the continent’s chips supplies come from outside the bloc, Von der Leyen said, adding: “This is a dependency and uncertainty we simply cannot afford.”
Major semiconductor producers are eying European expansion plans, with Taiwan Semiconductor Manufacturing Co (台積電) exploring a location in Germany and US company Intel Corp due to announce a number of investments in Germany, France and Italy.
In an interview with Bloomberg News editor-in-chief John Micklethwait at The Year Ahead conference on Wednesday, Intel CEO Pat Gelsinger urged the US and Europe to push ahead with efforts to bring back chip manufacturing.
“Let’s not waste this crisis,” he said. “It’s good economics, but it’s also national security.”
Last month, executives from more than 50 US companies called on US congressional leaders to pass legislation that provides US$52 billion in grants and incentives for domestic chip production, as well as a separate bill to encourage semiconductor design and manufacturing.
However, the legislation has been slow to move forward.
The funding plan, called the CHIPS Act, was included in a large package of legislation aimed at countering China that was passed by the US Senate in June last year.
It later stalled in the US House of Representatives.
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