The EC could approve aid to finance semiconductor production

The European Commission (EC) announced on Thursday that it could approve aid to finance semiconductor production in the 27-member block. It said this was due to a global shortage of chips and intense competition to meet demand. The Commission expects that the shortage of semiconductors, which are a key component in the production of a wide variety of products from smartphones to cars, will continue to affect the Union's economy. Among the worst affected are car manufacturers who have had to reduce or stop production due to shortages. At the same time, most chip manufacturers are based in Asia, and the bloc wants to reduce its dependence on them by strengthening production in its territory. "The Commission will consider approving support to address possible funding gaps in the semiconductor ecosystem, especially for European installations, the first of its kind," said EU Competition Commissioner Margrethe Vestager. In doing so, they will ensure that the aid is "necessary, proportionate, proportionate and, of course, to ensure that undue distortions of competition are limited". According to Vestager, self-sufficiency is an illusion, but the EU must not rely on one country or company to supply chips. "The aim should be to diversify among like-minded partners to build a resilient supply chain and to avoid failures at one point," she explained. The European bloc has already launched an industrial alliance this year, which aims to increase the EU's share of global semiconductor production to 20% by 2030.