Industry urges pragmatic EU Chips Act 2.0 to close gap with US and China

By Toby Sterling

AMSTERDAM (Reuters) -The European Union indispensable incentivise investments by machine spot equipment, materials and plan firms to guarantee the bloc's ​security and not lag further down U.S. and Asian rivals, manufacture radical ‌SEMI Europe recommended connected Tuesday.

The EU Commission had asked SEMI, which represents hundreds of European spot manufacture firms, for ‌recommendations arsenic it revises the 2023 Chips Act, which focused connected attracting 43 cardinal euros of concern into spot facilities successful Europe.

The U.S., China, South Korea, Taiwan and Japan person akin initiatives arsenic the contention for marketplace stock and request for proviso concatenation information accelerates ⁠in the AI era.

Following unit from ‌national governments led by the Netherlands, the EU Commission is owed to implicit a reappraisal of the instrumentality successful March, a fractional twelvemonth up ‍of schedule, and suggest important revisions successful what has been dubbed Chips Act 2.0.

"It is important to physique connected Europe’s beardown foundations with pragmatic reforms," SEMI said.

Rather than focusing connected attracting ​advanced manufacturing -- specified arsenic a erstwhile failed effort to bring Intel to Germany ‌-- backing indispensable spell to projects that volition enactment European proviso chains and physique connected existing strengths specified arsenic successful instrumentality manufacturing, wherever Europe hosts firms specified arsenic ASML successful the Netherlands.

That means letting spell of the strict "first of a kind" criterion for authorities aid. Meanwhile, to velocity up task approvals, the EU indispensable designate a azygous constituent ⁠of interaction for firms and governments and acceptable itself a ​public timeline to o.k. oregon contradict projects, SEMI said.

European ​governments successful a Dutch-led conjugation successful October called connected the EU to follow a Chips Act 2.0 that prioritised "the semiconductor assemblage arsenic a ‍strategic manufacture connected par with ⁠aerospace and defence and ... if indispensable usage each the disposable instruments to support it".

In summation to concern taxation breaks and task backing from subordinate states,⁠ SEMI argues the EU should besides person a fund of 20 cardinal euros ($23 billion) for spot ‌projects, which would correspond a quadrupling.

($1 = 0.8630 euros)

(Reporting ‌by Toby Sterling; Editing by Alison Williams)