EU is prepared to fund European chip manufacturing expansion

European Union
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The European Union (EU) has indicated it is prepared to fund initiatives that will strengthen Europe’s chip manufacturing capabilities.

A global chip shortage caused by the Coronavirus pandemic, combined with the rise of technology as a key strategic consideration, has led many countries and regions to reassess their supply chains and production capabilities.

The US, China and South Korea have all explored options, while the EU has previously suggested it would support an alliance between major European manufacturers such as ASML, Infineon, STM and NXP.

Qualcomm chip shortage

Now at a meeting at ASML, Commissioner for Internal Markets Thierry Breton said the Europe would need to expand its ability to produce ‘mid-level’ chips before it could achieve long-term targets of increasing its global market share and to produce more advanced silicon.

According to Reuters, Breton suggested funding could come from one of several EU investment programmes, including an €800 million Covid-19 recovery fund, and reiterated a desire for a major global player like Samsung, Intel or Taiwan Semiconductor Manufacturing Company (TSMC) to establish a state-of-the-art facility on the continent.

Industry figures are divided on how long the chip shortage will persist. The general consensus among analysts and industry figures is that the situation will ease before the end of the year, while others, such as Michael Dell, have suggested the shortage - or at least its effects - could last for years.

Ongoing difficulties would affect a wide range of electronic products, including mobile phones and wireless routers, as well as industries that are becoming increasingly reliant on connectivity, such as automotive. However, the impact will likely be less felt in premium segments, such as high-end smartphones, where major vendors can use their financial and market clout to secure a steady supply of chips. 

Via Reuters

Steve McCaskill is TechRadar Pro's resident mobile industry expert, covering all aspects of the UK and global news, from operators to service providers and everything in between. He is a former editor of Silicon UK and journalist with over a decade's experience in the technology industry, writing about technology, in particular, telecoms, mobile and sports tech, sports, video games and media.