Europe to incentivise governments to buy EU-made chips by startups, document shows
EU's Strategic Shift in Semiconductor Policy
By Foo Yun Chee
Background and Motivation
BRUSSELS, May 28 (Reuters) - The European Commission wants governments to buy chips made by EU startups as it seeks to reduce Europe's reliance on U.S. and East Asian products, a document seen by Reuters shows.
The proposal, dubbed Chips Act 2.0, supplements the original Chips Act implemented three years ago, which has so far failed to achieve its goals to attract advanced manufacturing in a bid to double the bloc's global chip market share to 20% by 2030.
Geopolitical Context
EU tech chief Henna Virkkunen will, on June 3, lay out details of the latest attempt to develop and control critical technologies and services, which has been driven mainly by tensions with the United States and China and their dominance in these areas. Europe makes about 10% of global semiconductors.
Chips Act 2.0: Demand-Side Measures
While the Chips Act focused on supply side measures, the Chips Act 2.0 will focus on the demand side, the EU document said.
Demand Accelerators and Innovation Procurement
"Through Demand Accelerators, the Chips Act 2.0 will also aim to boost the use of EU-designed and EU-made chips by linking suppliers with users via offtake agreements and a demand forum," the document said.
"To stimulate demand and support EU-based start-ups and scale-ups, the Chips Act 2.0 will deploy public innovation procurement, as a strategic tool," the paper said.
Investment and Environmental Approvals
The EU semiconductor ecosystem needs €120 billion ($139.81 billion) in public and private investments by 2035, of which some €30 billion would be for the advanced semiconductors manufacturing foundry, according to the document.
The Commission also proposed fast-tracking environmental approvals for chip facilities.
Additional Information
($1 = 0.8583 euros)
(Reporting by Foo Yun Chee; Editing by Barbara Lewis and Diti Pujara)
