Brussels, Jan 20 (Agency) Europe is ready to up its game on semi-conductor production, with its European Chips Act coming up in early February, announced Ursula von der Leyen, the European Commission president, on Thursday. “Today, we have microchips not only in our PCs and smartphones, but also now cars, the heating system of our homes, in our hospitals, in the life-saving ventilators …there is no digital without chips,” said von der Leyen in a special address at the World Economic Forums online Davos Agenda 2022 summit. The Chips Act should help the European Union (EU) in strengthening its research and innovation capacity, ensuring leadership in design and manufacturing, allowing public support for “first of a kind” production facilities, being better prepared for shortages and crises, and supporting smaller innovative companies. Chip shortage hit European manufacturers in spring last year, highlighting the continent’s dependency on suppliers from abroad, with cars makers being the worse-hit. Europe used to produce 30 to 40 per cent of the world’s semiconductor needs, but the ratio dropped to 10 per cent due to globalization.
The EU aims at producing 20 per cent of the world’s semiconductors by 2030. However, global needs in microchips should have doubled by then, which means that the EU will have to quadruple its production capacities, explained von der Leyen. The EU is already a world center for semi-conductor research, she added, and the region is well-positioned for equipment and materials needed to enlarge chip manufacturing plants. The Chips Act should enable the EU to become a strong player. However, the global market should be kept open, she added. “We will promote diversification among like-minded partners, we will create more balanced interdependencies, and we will build supply-chains we can trust by avoiding single points of failure,” said von der Leyen. During her address, she also tackled the current tensions between the EU and Russia. She encouraged Europe and Russia to solve their conflict through dialogue in “bodies formed for this purpose.” The World Economic Forum runs in Davos, Switzerland this week. Von der Leyen spoke remotely from Brussels, being stuck in preventive quarantine after her driver tested positive to Covid-19 on Monday.