EU Agrees on Semiconductor Support Act Worth 59 Trillion Won

Implemented Following Agreement by the European Parliament

[Image source=AFP Yonhap News]

[Asia Economy Reporter Yujin Cho] The European Union (EU) agreed on the European Chips Act (ECA), investing 43 billion euros (approximately 58.77 trillion KRW) to expand semiconductor production on the 1st (local time).

The EU Council announced this through a press release on its website, stating that the final version will be implemented after agreement with the European Parliament.

This bill was proposed last February to resolve semiconductor supply shortages within Europe and to achieve technological independence. It plans to establish a public-private fund of 43 billion euros and comprehensively invest in securing advanced semiconductor process capabilities and fostering the semiconductor ecosystem.

Of the 43 billion euros fund, 3.3 billion euros will be used to launch the "Chips for Europe Initiative," which supports semiconductor development and production.

Through this, the EU aims to increase its share of the global semiconductor production market from the current 10% to 20% by 2030.

The revised bill agreed upon by EU member states expanded the support scope not only to semiconductor production below 5 nanometers but also to industrial semiconductors.

Cedric Naike, Siemens Director, told Germany's Frankfurter Allgemeine Zeitung (FAZ) regarding this, "Semiconductors below 16 nanometers account for only 4% of the global market," adding, "The focus of the semiconductor support law should be broadened."

EU member states amended the bill so that many more projects can receive support whether produced in-house or outsourced.

This was done by expanding the types of semiconductors recognized as unique within the EU.

Meanwhile, FAZ pointed out that the United States has allocated more than 50 billion dollars (approximately 65 trillion KRW) for support through the Semiconductor Act and plans to invest an additional 82 billion dollars (approximately 106 trillion KRW) for research and development.