EU plans to increase government support for semiconductor industry to achieve chip “self-sufficiency”

To ease the global chip supply crisis, the European Union may ease restrictions on state aid to the semiconductor industry.

The European Commission is likely to agree on a new state aid policy at a meeting on Wednesday that would allow the government to subsidize Europe’s cutting-edge chip factories, according to a draft policy document.

Specifically, given the importance and difficulty of securing chip supply, the European Commission may “approve public support to fill possible funding gaps in the semiconductor ecosystem, especially in building Europe’s own pioneering facilities.”

European Commission President Ursula von der Leyen also visited the Dutch ASML company on Monday, and stated that Europe needs to improve chip design and research technology, increase production capacity, and establish closer cooperation with the industry. “Increased chip production in Europe is good for Europe, which means less reliance on East Asia,” she said.

It is worth mentioning that the EU will also announce the so-called “European Chip Act” in the first half of next year, which aims to promote its semiconductor production strategy, one of which is to occupy 20% of the global market share by 2030.

voices against government intervention

However, even if the global chip supply situation is severe, the EU’s policy has not been recognized by all member states.

The calls for more state intervention are mainly from the larger member states, led by France and Germany. Those wanting to stick to the EU’s free market have opposed this, arguing that it would give an unfair advantage to those with stronger economies, and warned that loosening state aid rules could weaken Europe’s position at the WTO. position in.

For example, last week, six EU member states, including the Netherlands, Denmark, and Ireland, sent a letter to the European Commission opposing the use of government funds for large-scale production or commercial activities, saying that key industries were “excessively and untargeted in strategic investment.” funding” will lead to a subsidy race and unfair competition within the EU.

Margrethe Vestager, head of the European Union’s antitrust bureau, is also one of the supporters against government intervention. In his view, European chip “self-sufficiency is an illusion.”

In addition, France is vigorously calling for the development of Europe’s own cutting-edge chip industry, but there are also many opponents who insist that funds need to be invested in less cutting-edge chips, because the shortage of these chips is the main factor affecting European manufacturing.