EU: € 43 billion mammoth plan for public and private investment in chips (semiconductors) by 2030

The European Commission today unveiled a € 43 billion plan for public and private investment in chips (semiconductors) by 2030.

Introducing the European Chips Act, Internal Market Commissioner Thierry Breton emphasized that the aim was to double the EU’s share of global chip production, which currently stands at just 10%, while reducing its dependence on Asian countries, mainly Taiwan and Korea. The production of semiconductors in Europe should reach 20% of the world market by 2030, in a market that will double anyway, so this means that we need a fourfold increase in the production of semiconductors on European soil, said the French Commissioner.

“Without chips, there is no digital transition, no green transition, no technological leadership. Securing the supply of the most advanced chips has become an economic and geopolitical priority,” said Thierry Breton, noting that the EU is mobilizing significant public funding, which already attracts significant private investment. “We are doing everything we can to secure the entire supply chain and avoid future shocks to our economy, as we see with the current shortage of chip supply. Investing in leading markets of the future and balancing global supply chains in Europe will allow competitive, create quality jobs and meet growing global demand, “he said.

According to the Commission communication, the recent global shortages of semiconductors have forced the closure of factories in a wide range of sectors, from cars to healthcare equipment. In the automotive sector, for example, production in some Member States fell by a third in 2021. This made more apparent the extreme global dependence of the semiconductor value chain on a very limited number of factors in a complex geopolitical context. But it also demonstrated the importance of semiconductors to the entire European industry and society.

The Commission proposes to allocate EUR 11 billion, about half of the EU budget and the other half from the Member States, to support existing research, development and innovation and to ensure the development of advanced semiconductors. The Commission is also proposing € 30 billion in public investment to increase semiconductor production in Europe – an amount that is expected to leverage more private investment. In order to have public support for investment in chip production facilities, the Commission will be able to consider approving state aid, subject to conditions.

More than € 2 billion is also earmarked to support start-ups through a new EU Chips Fund.

The Commission emphasizes that the Chips for Europe initiative will raise funds from the EU, Member States and third countries linked to the Union’s existing programs, as well as the private sector, through the enhanced Chips Joint Undertaking (Chips). Joint Undertaking).

“European chip law will ensure that the EU has the necessary tools, skills and technological capabilities to become a leader in this field beyond research and technology in the design, manufacture and packaging of advanced chips, to to ensure the supply of semiconductors and reduce its dependencies “, the Commission emphasizes.

Margaret Vestager, Vice-President of the Digital Agenda Commission, emphasized that the chips were essential for the green and digital transition and for the competitiveness of European industry. “We must not rely on one country or one company to ensure security of supply. We must do more together, in research, innovation, design, production facilities – to ensure that Europe is stronger as a key player. “It will also benefit our international partners. We will work with them to avoid future supply problems,” Vestager said.

The Commission’s proposals for a European chip law must first be approved by the Member States and the European Parliament for the regulation to apply directly across the EU.

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