The European Commission will put forward a “European Chips Act” to coordinate research, supply and manufacturing of semiconductors, president Ursula von der Leyen has announced.

In her annual State of the Union address to the European Parliament today, Von der Leyen said that “while global demand has exploded, Europe’s share across the entire value chain, from design to manufacturing capacity has shrunk.”

“We depend on state-of-the-art chips manufactured in Asia.”

To that end, the president announced that the Commission would introduce a law to “ link together our world-class research, design and testing capacities” and “coordinate EU and national investment along the value chain.”

“The aim is to jointly create a state-of-the-art European chip ecosystem, including production. That ensures our security of supply and will develop new markets for ground-breaking European tech.”

Von der Leyen’s speech is the latest in a series of strategy announcements from EU leaders on the subject of chip manufacturing.

In March, European Commission vice-president Margrethe Vestager and commissioner Thierry Breton announced a ten-year plan to see the bloc produce 20pc of the world’s semiconductors. Breton went on in May to confirm that the EU was prepared to invest “significant” amounts in the effort.

The European Chips Act, if passed by the European Parliament, would be the first major legislative effort in the area.

While details of the proposal have yet to be released, laws passed in this manner have more scope to coordinate and direct economic efforts in EU countries than policies enacted by the commission.

Intel has been seeking significant EU financial support, as much as €8bn in subsidies, for bringing new semiconductor manufacturing capacity to the bloc. Ireland is reportedly on the shortlist for this project.

Von der Leyen concluded defiantly: “Yes, this is a daunting task. And I know that some claim it cannot be done. But they said the same thing about Galileo 20 years ago.

“And look what happened. We got our act together. Today European satellites provide the navigation system for more than 2 billion smartphones worldwide. We are world leaders. So let’s be bold again, this time with semiconductors.”

Ursula von der Leyen. Image: European Parliament/Wikimedia Commons (CC BY 2.0)

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Author: Jack Kennedy

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