(MENAFN- Asia Times) In contrast to Dutch manufacturing equipment maker ASML's position at the center of the US-China trade and technology conflict, most European Semiconductor makers are maintaining a low profile.
For those who have not been following the issue, Netherlands-based ASML has a monopoly on the most advanced semiconductor lithography equipment (EUV), which it is not permitted to sell to China under US export restrictions.
Europe's largest semiconductor makers are Germany's Infineon, Switzerland-headquartered STMicroelectronics and the Netherlands' NXP, which rank 9th, 10th and 12th worldwide in terms of sales. In the second quarter of 2023, Infineon's sales were 35% as large as industry leader Intel's.
In July, on a visit to the Inter-University Microelectronics Center (IMEC) in Belgium, European Commission President Ursula von der Leyen said,“We need to reduce our dependency on too few suppliers from East Asia.
And we actively have to de-risk our supply chains for chips – it is vital.”
The Europeans think their semiconductor industry is too small and, in fact, data from market research and industry organizations indicate that only 5% of global semiconductor production capacity is based in Europe and that European companies account for only 9% of global chip sales. Europe buys about 20% of the world's semiconductors.
With this in mind, von der Leyen said,“We need to promote the design, testing and production [of semiconductors] here in Europe. For that, the Chips Act is the game changer.”
European Commission President Ursula von der Leyen, shown at a press conference after a virtual summit between EU and China in Brussels on June 22, 2020, wants Europe to up its chip-making game. Photo: Asia Times Files / AFP / Dursun Aydemir / Anadolu Agency
That was a reference to the European Chips Act, which was adopted on July 25. In the words of the European Commission, it“will mobilize more than 43 billion euros (US$45.5 billion) of public and private investments and set measures to prepare, anticipate and swiftly respond to any future supply chain disruptions, together with Member States and our international partners.”
The European Chips Act aims to:
Strengthen Europe's research and technology leadership towards smaller and faster chips; Build and reinforce capacity to innovate in the design, manufacturing and packaging of advanced chips; Address the skills shortage, attract new talent and support the emergence of a skilled workforce; Put in place a framework to increase production capacity to 20% of the global market by 2030; and Develop an in-depth understanding of the global semiconductor supply chains.
More specifically, it entails:
Investments in next-generation technologies; Providing access across Europe to design tools and pilot lines for the prototyping, testing and experimentation of cutting-edge chips; Certification procedures for energy-efficient and trusted chips to guarantee quality and security for critical applications; A more investor-friendly framework for establishing manufacturing facilities in Europe; Support for innovative start-ups, scale-ups and SMEs in accessing equity finance; Fostering skills, talent and innovation in microelectronics; Tools for anticipating and responding to semiconductor shortages and crises to ensure the security of supply; and Building semiconductor international partnerships with like-minded countries.
All that should keep EU bureaucrats busy but might be enough only to keep pace – not catch up – with technology and workforce development, market security measures, capacity additions and industry subsidies in the US, Taiwan, South Korea, Japan and China. But it needs to be done and should make a substantial future contribution to Europe's economy.
MENAFN29092023000159011032ID1107161859
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.