European Union Approves IDR 731 Trillion of Financing to Fund Own Chip Production

The European Union approved a plan to give 45 billion euros to fund chip production. (photo: Doc. Pixabay)

JAKARTA - European Union countries on Wednesday, November 23, approved a plan to provide 45 billion euros (Rp 731 trillion ) to fund chip production, which puts the 27-nation bloc one step closer to its target of reducing its dependence on chip manufacturers from the US and Asia .

"EU envoys unanimously support the amended version of the European Commission's proposal," said the representative of the Czech Republic who holds the EU rotating presidency.

EU ministers will meet again on December 1 to agree on a chip production plan that still needs to be debated with the European Parliament next year before it can become law.

EU executives, who hope state subsidies will help the bloc achieve a 20% share of global chip production capacity by 2030, came up with the proposal after global chip shortages and supply chain bottlenecks hit automakers, healthcare providers and telecom operators. Europe's share of chip production stands at 8%, down from 24% in 2000.

Changes approved by envoys to the EU Commission proposal include allowing state subsidies for a wider range of chip types and not just the most advanced ones. Subsidies will cover chips that deliver innovations in computing power, energy efficiency, environmental benefits and artificial intelligence.

In the document, EU countries also seek to curb the powers of the Commission, the EU executive, saying its requests to companies for information during a crisis must be proportionate and focused on security.

According to the document EU lawmakers still face the task of releasing funds for the project.

The Commission has allocated money from research programs and unspent funds from other schemes, but drew criticism from some EU countries that this could benefit countries that already have chip facilities or would unfairly attract chipmakers.