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Europe is Considering Relaxed Subsidy Rules for Chip Factories

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The European Union will look at whether the rules for state aid can be relaxed for chipmakers. Europe would like to have more chip factories on its own soil, but they are costly to set up.

 

According to Bloomberg, the European Commission would examine today whether the current approach can be changed. This question comes mainly from European Commissioner for the Internal Market Thierry Breton. Not everyone is won over by that, though. According to the press agency, Marghrete Vestager (European Commissioner for Competition) would be against it.

By 2030, Europe wants twenty percent of chip production on European soil and would therefore like to convince chip manufacturers such as TSMC or Intel. But building a factory costs billions of euros. At the same time, advanced chips are outdated in terms of technology after only a few years. This means that the time to make a factory profitable is minimal.

In Asian countries, governments have generally been more willing to subsidize a significant amount of construction costs. This is more difficult in Europe because there are restrictions on how much aid a country can give. Relaxing the rules for chipmakers opens a door for convincing big players to bake chips in our region.

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