[Asia Economy Reporter Jeong Hyunjin] To gain an advantage in the semiconductor supremacy competition, the European Union (EU) has approved a plan to support Swiss electronics company STMicroelectronics in building a new factory in Italy. This is the first outcome since the EU introduced the CHIPS ACT in February. It is interpreted as a step forward to expand semiconductor production within Europe.
On the 5th (local time), the European Commission announced that, under EU member state aid rules, it approved a measure for the Italian government to use the European Recovery and Resilience Facility (RRF) to support STMicroelectronics in constructing a semiconductor manufacturing facility in Catania, Sicily, Italy. STMicroelectronics will invest a total of 730 million euros (approximately 1.03 trillion KRW) in this factory. Of this, 292.5 million euros will be supported by the Italian government.
STMicroelectronics plans to produce silicon carbide (SiC) wafers, considered next-generation power semiconductors, at this factory. STMicroelectronics already has an SiC wafer manufacturing facility in Catania and plans to build the new factory alongside it on the same site. Mass production is expected to begin next year. The European Commission forecasts that 700 jobs will be created through the construction of this new factory.
Foreign media explained that this is the first project approved as the EU expands semiconductor production within the region. The EU has set a goal to increase Europe’s share of the semiconductor manufacturing market from less than 10% currently to around 20% by 2030. In February, through the CHIPS ACT, the EU announced that in addition to the previously planned 30 billion euros in public support, there will be 15 billion euros in public and private investments by 2030.
Margrethe Vestager, EU Executive Vice-President, said, "This measure will strengthen Europe’s semiconductor supply chain and help the green and digital transition," adding, "Our industry will secure a reliable supplier to provide substrates for power-efficient semiconductors."
Earlier in July, STMicroelectronics announced plans to build a semiconductor factory in France together with the US company GlobalFoundries. US semiconductor manufacturer Intel is also reportedly considering building a semiconductor factory worth billions of euros in Italy. Negotiations with local Italian authorities are still ongoing, and the northern region of Italy is considered a likely site for construction.
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