As the global economy becomes increasingly reliant on technology, the competition for control of critical components and technologies has intensified. One of the key areas of focus in this competition is the semiconductor industry, which is crucial for everything from smartphones to military hardware.

In recent years, China has emerged as a major player in the semiconductor industry, raising concerns in the EU and the US about their reliance on Chinese companies for critical components. To address this issue, both the EU and the US have announced plans to strengthen their semiconductor industries and reduce their reliance on China.

Table of Contents:

• The EU’s European Chips Act
• The US’ executive order on semiconductor supply chains
• Private sector efforts
• Conclusion
• References

The EU’s European Chips Act

In May 2021, the EU announced its European Chips Act, a proposed legislation that aims to double the EU’s share of global semiconductor production to 20% by 2030. The act includes plans to invest in R&D, increase the production of advanced semiconductors, and promote collaboration between EU countries and with international partners. The act also proposes the creation of a European semiconductor research institute and a European semiconductor industrial consortium. These measures are aimed at reducing the EU’s reliance on imported semiconductors, particularly from China.

The US’ executive order on semiconductor supply chains

In February 2021, President Joe Biden signed an executive order to review and strengthen the country’s supply chains for critical products, including semiconductors. The order includes plans to invest in domestic semiconductor manufacturing and R&D, and to work with allies to secure critical supply chains. The order also directs a 100-day review of key products, including semiconductors, to identify vulnerabilities in the supply chain and to develop strategies to address them. The aim is to reduce the US’ dependence on foreign semiconductor manufacturers, particularly in China.

Private sector efforts

In addition to these government-led efforts, many companies in the US and the EU are also investing heavily in semiconductor manufacturing and R&D. For example, Intel recently announced plans to invest $20 billion in two new chip factories in Arizona, and TSMC, a leading semiconductor manufacturer based in Taiwan, is planning to build a new factory in Arizona. In Europe, companies such as Infineon and STMicroelectronics are also investing in semiconductor manufacturing and R&D. These private sector efforts are aimed at reducing reliance on China for critical components and technologies, and at ensuring that the EU and the US remain competitive in the global semiconductor industry.

Conclusion

The competition for control of critical components and technologies is intensifying, and the semiconductor industry is at the forefront of this competition. To reduce their dependence on China and ensure that they remain competitive in the global semiconductor industry, the EU and the US are investing in R&D, increasing semiconductor production, and working with allies to secure critical supply chains. Private sector companies are also investing in semiconductor manufacturing and R&D. These efforts are aimed at reducing reliance on China for critical components and technologies, and at ensuring that the EU and the US remain competitive in the global semiconductor industry.

References:

European Commission. (2021, May 19). The European Chips Act: Questions and Answers. 
The White House. (2021, February 24). Executive Order on America’s Supply Chains. 
Lunden, I. (2021, March 24). Intel to invest $20B into two new chip fabs in Arizona as part of growing domestic chipmaking investment. TechCrunch. 
Reuters. (2021, March 15). TSMC plans to build Arizona chip plant as U.S. chip demand rises. CNBC.