European Chips Act: the importance of supporting European Research


The crisis in the semiconductors supply chain needs to be urgently addressed, as the consequences of the pandemic before and the war in Ukraine after having been affecting Europe’s accessibility to these precious components.  As a matter of fact, the European Commission has recently recognized this priority, by developing an European Chips Act, which aims to strengthen manufacturing activities, support rt innovation and reinforce Europe’s technological leadership, by adopting a  a resilient ecosystem approach. 

However, as some experts in the field say, the Commission is not acting in the right way and a lot of critics have been raising up. The first perplexity is about the focus of the action itself: the Commission wants to invest most of money on the production of high-end chips, but the current demand from the European industry is concentrated on low-end chips.  

A second issue concerns the total budget, which might be inadequate to address this challenge: according to the plans, 11 billion of € will come from public funds that have been redirected from programmes such as Horizon Europe and Digital Europe, while 32 billion € will be provided thanks to private investments. These amounts are little if we consider the cost of new chip fabrication plants and the high energy costs make the situation worse. Moreover, the importance given to private investments might strengthen collaboration between private companies and national governments, at the expense of European power.  

On its part, the European Commission reiterates that it is also necessary to look to the future and anticipate future needs and for this reason, low-end and high-end chips should not be options but both valid choices by establishing future investments.  

Given this context, it emerges that European relevance in value chains, design and manufacturing is weak and it can’t compete with other global actors such as East Asia. Notwithstanding this, Europe boasts an excellent Research & Innovation sector and the European Commission should increase its efforts to maintain this leadership.  

In this regard, all the suppliers included in the European semiconductors supply chain have the possibility to participate in the survey “European semiconductor value chain consultation”, open from the 10th of October to the 11th of November 2022.

Don’t miss the opportunity to have your say!