There is no digital without chips. Semiconductor chips are a powerful part of the world’s digital transformation and have an important impact in the economy. They are key to the technologies of the future, such as artificial intelligence (AI) and 5G/6G. Chips are also fundamental to make digital products work, including smartphones, cars as well as applications and infrastructures in most industry sectors.
Chips are the result of highly sophisticated technologies and their production is very complex, as it involves over 1,000 steps. Furthermore, the exportation process is very long, as this type of products will have to cross international borders several times before reaching an end costumer, which increases the risk of delay. Since late 2020, as a consequence of the Covid-19 pandemic, there have been unprecedented chip shortages. The main industries severely affected by this shortage have been automotive, consumer electronics, household appliances and LED lighting.
In 2022, The European Union announced the Chips Act, a plan to address the global semiconductor shortage. This initiative aims to help the EU to remain competitive in chip technology and maintain its own supply chain for chips and other electronic components, by boosting its production capacity in the long term. This will help to protect Europe’s economy within the semiconductor ecosystem from any future disruptions caused by external events, thus reducing the impact in case of an international crisis.
In February 2023, the negotiating mandate was put to vote during the plenary session of the European Parliament. The Members of the European Parliament backed the Chips Act plan, as well as other measures to boost chips production and innovation, such as the Chips Joint Undertaking proposal.
References:
REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL establishing a framework of measures for strengthening Europe’s semiconductor ecosystem (Chips Act) (no date) EUR-Lex. Available at: https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A32022R0720 (Accessed: February 22, 2023).
Chips act – the EU’s plan to overcome semiconductor shortage: News: European parliament (2023) Chips Act – the EU’s plan to overcome semiconductor shortage | News | European Parliament. Available at: https://www.europarl.europa.eu/news/en/headlines/society/20230210STO74502/chips-act-the-eu-s-plan-to-overcome-semiconductor-shortage (Accessed: February 22, 2023).
Semiconductors: Meps ready to start talks on new law to boost EU chips industry: News: European parliament (2023) Semiconductors: MEPs ready to start talks on new law to boost EU chips industry | News | European Parliament. Available at: https://www.europarl.europa.eu/news/en/press-room/20230210IPR74801/semiconductors-meps-ready-to-start-talks-on-new-law-to-boost-eu-chips-industry (Accessed: February 22, 2023).
EP, A. (2022) Supply of computer chips and semiconductors, Epthinktank. Epthinktank. Available at: https://epthinktank.eu/2022/03/29/supply-of-computer-chips-and-semiconductors/ (Accessed: February 22, 2023).
Written by Laia Pérez Picó
Born in Alicante, Spain, Laia holds a Bachelor’s degree in Translation and Interpreting. She had the opportunity to study abroad in Canada and France thanks to different mobility programs. She also holds a Master’s degree in Institutional Translation at the University of Alicante and a second Master’s degree in Translation Technologies with an specialisation in Terminology at the University of Geneva.