Europe will launch a law to multiply its chip production by four in 2030 and stop its current dependence

In the midst of the semiconductor crisis, Europe is moving to guarantee its supply, reduce costs and cut its dependence on the great production poles of China and the USA. During a speech at the World Economic Forum, the president of the European Commission ( CE), Ursula von der Leyen, has outlined the roadmap that the body will follow in the short term and has set some tasks. The first, already for next month: present a law designed to boost the semiconductor manufacturing sector in European territory.

“The European need for chips will double over the next decade. That is why we need to radically raise the level of Europe in the development, production and use of this key technology”, stressed von der Leyen, who stressed that, although Europe has certain strengths and is “very well positioned” in the design of components for electronics and research into semiconductors or materials and equipment, its weight in the sector is still very low.

A growing demand

“Europe’s global market share for semiconductors is only 10%, and currently most of our supplies come from a handful of producers outside of Europe. This is a dependency and uncertainty that we simply cannot afford,” he settled.

Beyond the declaration of intent, von der Leyen specified what the objective that Europe should pursue should be: to reinforce its weight so that in less than a decade, in 2030, it manages to concentrate 20% of world microchip production. Given that the sector itself will experience growth, the president of the EC estimates that this goal will be equivalent to quadrupling current European production. “No time to lose. That is why I can announce that we will propose our European Chip Law at the beginning of February”, he claimed. The standard will focus on objectives such as “strengthening” research capacity or “ensuring leadership” in design and manufacturing.

Its focus will also be on economic support for companies. The EC wants to adapt its rules on state aid – yes, “under strict conditions” – and provide “public support” to European production facilities. To alleviate situations of scarcity, it also seeks to strengthen its own skills, anticipate and “strengthen our security of supply”.

“Europe will always work for keep global markets open and connected; but we need to address the bottlenecks that slow down our own growth”, he claimed: “We will promote diversification among like-minded partners. We will create more balanced interdependencies and build supply chains that we can trust by avoiding single points of failure.”

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By bringing manufacturing closer to its own territory, the US will not only reduce dependence on poles located in other regions —which gives rise, in the words of the president of the EC, to an “uncertainty that we cannot afford”—. With less displacement, the impact of the sector on the environment and its own transport costs would also be cut. The goal is also marked in a scenario that foresees a clear increase in the demand for semiconductors. During her speech, von der Leyen herself advanced that the European demand for chips will double over the next decade, a growth homologous to the rate of production itself Worldwide.

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Although steps have been taken in recent years that have strengthened European chip production —in what is known as Silicon Saxony, in Germany, a pole has been established from which, according to their data, one out of every three chips manufactured in Europe and just a few months ago Bosch opened a new semiconductor factory in Dresden—some of the major global chip development companies are not present in Europe.

The future law of the European Commission will not favor only that the EU states collaborate in the financing of the sector. It also wants to “support the smallest and most innovative companies so that they can access advanced skills, industrial partners and equity financing”.

Images | European Parliament (Flickr) and TSMC

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