The European Union wants to mitigate the semiconductor crisis in the only way they know how to do it in Brussels: by injecting millions into the industry without having a concrete plan. The Commission's new proposal seeks to reduce dependence on chips from Asian countries through a series of investment plans to boost local industry.
Or, rather, to make it from scratch. The idea is to inject billions of euros in funds for research and semiconductor factories in a way that boosts the domestic economy and reduces dependence on China and other countries in the field of semiconductors.
In this sense, the European Commission has presented a new proposal for legislation to make available to the member states around 45 billion euros in public funds for the manufacturing industry of chips.
And not only that: also to impose on European companies the need to give priority to local chip production in the event of a shortage. The basic plan is that: million dollar incentives for each country to boost the chip industry and for Europe to stop being dependent on other countries.
A 'plan' whose only 'plan' is money: investments for chips turned into public spending
Although it is true that the great semiconductor powers are from Asia (and from the US), the truth is that the EU is a great supplier of manufacturing material for these countries, but it is highly dependent on the final product.
It should be borne in mind that in the early 1990s and later, Europe, along with the US, were two of the most important powers in semiconductor manufacturing, but relocation of production to Asia has increased its dependence and the domestic industry is at a minimum.
It is not very clear that the European plan will generate great results or will change the current table of semiconductors. Although the total amount of almost fifty billion euros seems enormous, the union has a long history of large investments without capitalizing, since most of these plans end up without commercially successful products
That the main problem of the measure, which seeks to generate private investment through public plans, is that there is a concrete common front beyond the generality of “strengthening the local semiconductor industry.” Investment discrepancies between regions and EU countries is another big problem. Without a series of specific objectives over time beyond the investment plans. The only concrete framework? That 20% of world chip production be European by 2030. And that without taking into account the investments of competing regions.
All this in a context in which some countries have their domestic industrial sector in dismantling in favor of relocation. Another like Spain, with its research muscle at a minimum. Little concrete plans that will end up causing many of the funds to end up in countries with great technological development without common benefit. Or on deaf ears without viable products, and therefore, back to the starting point.
In the end, Europe only knows how to promote industries in one way. And it does not seem that the Chip Law will have any other purpose than to inject public money into a relocated industry and pray that it does not ends up being invested, indirectly, in the Chinese economy.
