Le Monde called the EU's plans for independence in semiconductors unattainable

The European Union's (EU) plans to reduce dependence on the United States and China for semiconductors remain elusive, and attempts to capitalize on the confrontation between the two world leaders have failed. This was reported on December 24 by the newspaper Le Monde.

"Two years after the entry into force of the chip law in September 2023, Europe is still heavily dependent on China and the United States for semiconductor supplies <...> [Earlier] The European Court of Auditors has recognized the goal set by the 27 member states in the Law as unattainable," the article says.

In 1990, the EU owned 44% of the world's semiconductor manufacturing capacity. By 2020, this share has decreased to 8%. According to the goals set two years ago, the Europeans were supposed to win back 20% of the share of global production by 2030, but, given the current state of affairs, they will be able to reach only 11.7%.

Achieving the goals of the chip act has been complicated by the unfavorable economic climate, which limits the flow of investment, while promised government assistance remains insufficient. The EU has also focused its efforts on advanced nanochips needed for AI and defense, to the detriment of more traditional industries such as automotive.

The EU needs to increase production capacity four times in five years, which seems impossible given the failures of flagship projects. The European Commission estimates that of the approximately twenty projects it considers still viable, many are in poor condition or have been suspended.

The plan to expand the chip manufacturing plant in the French city of Krol through investments by the American GlobalFoundaries, presented by French President Emmanuel Macron in 2022, has been suspended, despite promised government assistance in the amount of €3 billion.

The desire of the largest American corporation Intel to invest €30 billion in the Silicon Node industrial cluster in Magdeburg, Germany, was supposed to turn Germany into "one of the world's largest semiconductor manufacturing centers." However, after struggling to receive a €10 billion contribution from Berlin, the American giant abandoned its European projects.

"The chip law was supposed to allow Europeans to attract unprecedented investments <...> but has not yet changed the course of history, which represents a slow loss of influence. <...> Now there are only memories of the times when the European Union hoped to gain an advantage in the fierce struggle between China and the United States for control of semiconductors," the newspaper writes.

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The Reuters news agency reported on November 8 that Germany's ruling coalition plans to review its trade policy towards China, including on energy, raw material imports and Chinese investments in critical infrastructure, and will also create an expert committee that will report to parliament.

The Bild newspaper said on October 24 that Berlin had sent a diplomatic note to Beijing over the ban on the supply of Chinese microchips to Europe. German Minister of Economy and Energy Katerina Reiche noted that the government has not yet been able to solve the problem of the shortage of chips.

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