The European Chips Act is on its way. In early February, the European Commission will present a legislative proposal to double European chip production.

“Most supplies come from a handful of producers outside Europe. This is a dependency and uncertainty we simply cannot afford”, said Ursula von der Leyen, President of the European Commission (EC).

The goal is clear. By 2030, 20 percent of worldwide chip production should take place in Europe. Currently, the share is about 10 percent. Europe has a long way to go.

How?

Currently, the exact plan of attack is known only to policymakers. The EC probably wants to invest more money in chip manufacturers and developers. Thereby, manufacturers have a financial reason to collaborate and tackle supply chain problems together. In addition, funding for the development of innovative chips can stimulate the global demand for European chips.

In early February, the EC will present a first draft of the proposal. Subsequently, the proposal will be reviewed by the representatives and leaders of all European member states. Only with their agreement can the proposal become law.

Tip: Here’s why the global chip shortage persists in 2022