Semiconductors (European market)

Semiconductors (Global Market)

Main Article: Semiconductors (Global Market)

Semiconductors in Italy

Main article: Semiconductors (Italian market)

Semiconductors in Spain

Main article: Semiconductors (Spanish market)

2024: $46.3 billion earmarked for semiconductor industry

As of May 2024

2023

The EU has passed a chip bill. How Europe will now develop the semiconductor industry

In September 2023, the European Union passed a so-called "chip law" designed to stimulate the development of European microelectronics and reduce dependence on Asian semiconductor manufacturers.

The program provided for by the document should help the EU double its share in the global semiconductor market by 2030, reaching at least 20%. To do this, it is planned to attract 43 billion euros of public and private investment, including 3.3 billion euros from the EU budget.

EU passes' chip legislation'

It is assumed that the regulation will strengthen the EU industrial base for the production of chips and ensure its technological sovereignty. This, apparently, is a confrontation with China, which has a full cycle of obtaining rare earth metals necessary for the production of chips.

The subsidy program will make up the bulk of the chip law budget passed by the EU. It is assumed that an impressive part of the allocated budget of 17 billion euros may go to Intel, which is considering the construction of a chip factory in Magdeburg (Germany).

The Institute for Statistical Research and Knowledge Economics of the Higher School of Economics, having analyzed the main provisions of the law, identified 5 of them:

• A virtual chip design platform that allows you to develop new components, systems with low power consumption, high security and improved system integration and 3D assembly capabilities.
• Pilot lines for launching the production of innovative chips (for example, playing an important role in the "green" transition in the automotive industry and ICT), as well as infrastructure facilities for conducting tests and experiments. Some pilot lines will allow the development of chips with a high level of energy efficiency (chips on FD-SOI plates (Fully Deployed Silicon on Insulator - substrates with a very thin insulating layer of depleted silicon) on a process technology of 10 nm and less and advanced chips on a process technology of 2 nm); other pilot lines will work out the integration of three-dimensional heterogeneous systems (modern chips with a higher density of transistors) and advanced packaging (advanced packaging).
• Advanced technology and engineering power for "quantum" chips. It is planned to develop pilot lines for the design, prototyping and production of chips using quantum effects, as well as the creation of equipment for testing such chips.
• A network of competence and professional development centers that will become poles of attraction for talents.
• The Chip Fund, which will provide debt and equity financing for EU startups, fast-growing scale-ups and SMEs in the semiconductor value chain. Decisions on the fund's support for specific companies will be made by the European Innovation Council.^[1]

EU allocates €8.1 billion to support semiconductor industry

On 8 June 2023, the European Commission approved the massive IPCEI ME/CT programme to support the semiconductor industry. More than €8 billion in state grants will be allocated for the development of projects in the field of microelectronics and communication technologies.

The IPCEI ME/CT (Important Project of Common European Interest MicroElectronics and Communication Technologies) initiative aims to reduce the technological lag from, and USA South Korea. Taiwan 14 European countries take part in the program:,,,,,,,,,,,,,, and Austria Czech Republic Finland France Germany Greece. Ireland Italy Malta Netherlands Poland Romania Slovakia They will provide Spain state funding totaling €8.1 billion. In addition, it is expected that European Union approximately €13.7 billion of private investment will be attracted to the development of the semiconductor industry. Thus, the IPCEI ME/CT budget will reach almost €22 billion.

European Commission approves massive IPCEI ME/CT programme to support semiconductor industry

It is planned that as part of the support program, 56 companies, including small and medium-sized enterprises and startups, are implementing a total of 68 promising projects. It is said that these projects are aimed at ensuring digital transformation by creating innovative microelectronic and communication solutions, as well as developing energy-efficient and resource-saving electronic systems and production methods.

Overall, the IPCEI ME/CT initiative will drive technological advances across many sectors, including 5G and 6G cellular networks, autonomous driving, artificial intelligence and quantum computing. In addition, support will be provided to companies that specialize in technologies related to the receipt and use of "green" energy. The first products can be introduced to the market in 2025, and the program is scheduled to be completed in 2032.^[2]

Britain plans to allocate £1bn to boost semiconductor development

The British leadership in May 2023 announced measures to support the national semiconductor industry in the amount of up to 1 billion pounds. Initial investment in the industry will be up to 200 million pounds between 2023 and 2025, the government said, and within 10 years the state's contribution will reach the stated figure.

Funding is provided as part of a long-term strategy to develop the semiconductor industry, which is being implemented with long delays. Difficulties in implementing the initiative are associated with numerous government reshuffles caused by the resignations of former prime ministers Boris Johnson and Liz Truss.

Britain takes a slightly different approach to the US and the EU investing larger sums in their own semiconductor production. London is not aiming to build its own large businesses to make modern chips. Instead, the country has focused on developing faceless companies. Such enterprises specialize in the development and sale of technologies, but do not have their own production facilities.

Some British companies have warned authorities they will leave the country if the government does not increase support for the industry.

2022: European Commission allocates €43 billion for chip production in EU

In February 2022, the European Commission (EC) announced the allocation of €43 billion for the implementation of the chip law, which is designed to strengthen the European semiconductor industry through large investments and reduce dependence on foreign chip supply chains.

The law aims to create a thriving semiconductor sector from research to manufacturing and a sustainable supply chain, EC officials said. This will be done by mobilizing €43 billion in public and private investment, although the commission did not say how much of it is direct investment.

The European Commission allocates €43 billion for the production of chips in the EU

The EC will also create a structure to ensure the reliability of supplies by attracting investment and expanding production capacities. The chip fund will facilitate access to funding for start-ups and help them perfect their innovations and attract investors. As part of InvestEU, a special semiconductor investment mechanism will be created to support large and small enterprises, which will make it easier for them to expand the market. The law will also include a coordination mechanism between member states and the commission to monitor semiconductor supplies, assess demand and predict shortages. This will track the value chain by gathering information from companies to identify major weaknesses and bottlenecks.

We should not rely on one country or one company to secure supplies. We must do more together - in research, innovation, design, manufacturing capacity - to make Europe stronger as a key participant in the global value chain. Chips are essential for the green and digital transition - and for the competitiveness of European industry, said Margrethe Vestager, Executive Vice President of the European Commission for Digital Technologies.

The EU budget should support the initiative by €1.65 billion (under the Horizon Europe^[3] program^[4]) and €1.65 billion (under the Digital Europe^[5]). Of the total amount of €3.3 billion in the framework of the joint development of semiconductors, €2.875 billion^[6] will be sold^[7]. [1]Learn more here.

The EC offered an accompanying recommendation to Member States, which is a tool to immediately launch a coordination mechanism between Member States and the EC. The measure is expected to allow them to discuss and quickly make decisions on timely and proportionate response to a market crisis. ^[8]

2021

Establishment of the European Alliance for Processors and Semiconductor Technologies

In July 2021, the European Commission established the European Alliance for Processors and Semiconductor Technologies, bringing together key participants in ^[9] development and production^[10] chips^[11]. A large-scale step to develop the industry was the 2021 pan-European Digital Compass plan to create its own microelectronic ecosystem. Within the framework of the EU semiconductor strategy, five main goals have been set:

• Strengthening Europe's R&D leadership;
• strengthening its own capacity to introduce innovations into the production of advanced chips and turn them into commercial products;
• creating the basis for a significant increase in production capacity by 2030;
• eliminating the shortage of personnel, attracting new talents and supporting the skilled workforce;
• developing a deep understanding of the 2022/0032 (COD) global chip supply chains^[12].

=Europe has allocated €145 billion for the creation of advanced processors

In early January 2021, it became known that 17 EU member states signed a declaration worth 145 billion euros for the development of new generation processors. The funding is designed for two to three years and will go to the development of economical processors with data protection function and the development of lithographic technologies with standards up to 2 nm inclusive. This declaration is intended to bring Europe to the first places in the development and production of semiconductors.

The move is seen as vital to Europe's development, as advanced semiconductor technology is used throughout and the project will help ensure that Europe does not become too dependent on other economic blocs. According to the conclusion published by the European Commission, the creation of secure processors for use in cars, medical equipment, mobile phones and network components ensures competitiveness at the global level. In the semiconductor industry, seven key areas have been allocated to finance developments from the European budget.

EU allocates €145 billion to develop advanced processors

It is assumed that the allocated state funds will be used to finance those projects that cannot be implemented only at the expense of private capital due to their unprofitability or high degree of risk. As a result of such initiatives, industrial alliances may arise, uniting companies from different countries. The focus will be on the development of modern sensors, components for artificial intelligence systems, microcontrollers, low-power components and secure processors.

The EU Declaration was signed by, Belgium,, Croatia,, Greece,, Netherlands,, Slovenia,, Finland,, France,,, and Estonia Malta. Portugal Slovakia Cyprus Germany Italy Since she Spain Austria left Romania the EU, she Great Britain cannot take part in the signing of this declaration or the implementation of these development plans.^[13]

2020

Europe accounts for only 6% of chip production

In 2020 Europe , only 6% of global chip production accounted for. This figure was cited by the insurance company Euler Hermes , citing data from the non-profit organization World Semiconductor Trade Statistics (WSTS), which unites the largest manufacturers of semiconductor products.

The study notes that only three major manufacturers of automotive and industrial microcircuits are based in Europe: Infineon, NXP and STMicroelectronics. Since the structure of local production corresponds to the structure of local demand, in Europe there is practically no capacity for the production of chips in accordance with technological processes less than 22 nm, first presented back in the early 2010s.

According to WSTS, in 2020, Europe's share in global chip sales fell to 8.5% from 9% a year earlier and 17% in 2005. The region's lag in terms of purchases of equipment for the production of chips is also significant: the share of Europe in 2020 was 4% against 26%, 24% and 23% from China, Taiwan and South Korea, respectively.

According to experts, the acute shortage of semiconductors, which arose at the end of 2020, demonstrated the vulnerability of Europe, importing components from Asia. In this regard, the European Commission would like to increase Europe's share in global semiconductor production from 6% to 20% by 2030.

It will not be possible to achieve such a result without a sharp increase in investment, experts at Euler Hermes say. They find further confirmation of the growing investment gap between Asia and the rest of the world, based on capital spending that Chinese, Taiwanese and South Korean players have far higher than European companies. Given the length of the industry's development cycles, Europe's share of global semiconductor production could decline further by 2025. Therefore, the goal - to reach the level of 20% of the total world production by 2030 - will become even more unrealistic for Europe, even if European production capacity increases sharply in the second half of the 2020s, the researchers believe.

In their opinion, the limited demand makes one doubt the achievability of the goal of creating the most modern semiconductor production in Europe. No European manufacturer has the needs, financial capabilities, or necessary technologies to create a large-scale production of chips based on a 5 nm process technology. Such a plant could only be built by Intel, Samsung Electronics or TSMC, this project would require significant financial support to attract investments that would otherwise be made in North America or Asia. Intel estimates that at least €8bn worth of subsidies will be required to build a new chip plant in Europe.

Common measures used in Asia and America to encourage investment in semiconductor manufacturing include, among other things, lower corporate income taxes on manufacturing operations, accelerated depreciation, and low-cost financing schemes. More significant independence in the field of production will benefit not only the European semiconductor ecosystem, but also help local industry insure against future interruptions in the supply of chips, according to Euler Hermes.

Analysts add that European authorities could encourage investment in chip production for those industries where there is the most acute shortage of chips - this is primarily the automotive industry and industry.^[14]

Europe plays the race in semiconductor manufacturing

The US, China and Europe are worried about Taiwan and South Korea's lead in semiconductor manufacturing. The U.S. accounted for just 12% of semiconductor capacity in 2020, while Taiwan and South Korea combined provided 43%, according to a report released in September 2020 by the Boston Consulting Group (BCG) and the Semiconductor Industry Association (SIA).

Calculation data for 2020 dated September 2020

Notes