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European Union Plans to Create an Advanced Domestic Semiconductor Ecosystem by 2030

European Union Plans to Create an Advanced Domestic Semiconductor Ecosystem by 2030

Bosch Semiconductor office building; as the EU prepares to build out its domestic semiconductor hub, what does this mean for supply chain routes? Good news, we're sure. In the meanwhile, learn more about shoring up your own supply chain by using sourcengine.com.

The European Union intends to cultivate a robust domestic semiconductor ecosystem capable of producing advanced microchips by 2030, reports Bloomberg. The European Commission included the milestone to enlarge its technological infrastructure in its "Digital Compass" initiative.

The EU’s plans coincide with chip sector optimizing initiatives introduced by leaders in China and the United States.

EU’s Domestic Semiconductor Ecosystem Development Plans

The European Commission is interested in developing its domestic semiconductor industry to ensure its long-term financial stability and growth. The organization has seen the deleterious effects of the U.S.-China trade war, COVID-19, and the global chip shortage. By fostering a strong and innovative local ecosystem, it hopes to protect its supply chain from similar headwinds in the future.

The EU intends to produce 20 percent of the world's advanced electronic components by 2030.

To realize that goal, the bloc wants to establish a state-of-the-art foundry complex on the continent. Once up and running, the facility would fabricate chips at the sub-5nm scale. Local leaders previously suggested partnering with either Taiwan Semiconductor Manufacturing Company (TSMC) or Samsung to build the cutting-edge factory.

Digital Compass also involves making technology a bigger part of life and commerce in the EU.

The plan calls for setting up 10,000 climate-neutral edge nodes and equipping 70 percent of its local firms with “Cloud/AI/Big Data” resources by 2030. It also features a provision to make citizens' pink medical records available electronically and get 80 percent of its citizens using digital IDs. In addition, Brussels wants all European households to have gigabit connectivity and create 20 million ICT specialists within the decade.

At present, the European Commission’s Digital Compass plans do not detail how the initiative would be executed.

However, one EU member state has already taken action to increase its semiconductor resources. The German federal and state governments provided funding to help Bosch build a state-of-the-art wafer fab. The €1 billion ($1.18 billion) facility features a fully automated manufacturing process and will begin producing automotive sensors in June.

The nation’s officials intend to transform Dresden into a chip design and production hotspot.

China and the United States Bolstering Their Chip Sectors

Like the EU, China and the United States have plans to bolster their respective semiconductor sectors in the near future.

Beijing will increase its national research and development spending by 7 percent this year. Its main focus areas include the electronic components, operating system, data center, and computer processor segments. The local government views domestic chip design and third-generation semiconductor development as priorities.

China’s leaders hope the digitalization-related aspects of its 14th five-year plan will lower its dependence on imported technologies.

Similarly, the White House recently ordered a 100-day review of its critical supply chains to reduce its need for outsourced production. The program includes providing financial support for corporations that will improve America’s chip production capacity as quickly as possible. The U.S. Senate is also mulling over a bill that would direct $30 billion in federal funding to its semiconductor ecosystem.

It is hard to gauge the impact of three global powers dedicating their resources to chip development at this stage. However, with billions of dollars being poured into the industry, significant technological innovation is inevitable. Plus, the aggressive nature of Europe, China, and America’s semiconductor roadmaps indicates transformational outcomes will take place relatively soon.

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