In the past two years, the shortage of semiconductor chips has been one of the key problems in the technology, electronics and automotive industries. The unavailability of chipsets and electronic components has had a significant impact on the business in terms of revenue and customer experience.
In response to higher customer demand and supply chain crises, the technology, electronics and automotive industries have begun to develop short-term and long-term strategies to simplify chip production and shorten delivery times.
In addition, the government also realized that the shortage of semiconductor chips affected enterprises and the economy at a higher level. Therefore, the United States, the United Kingdom, the European Union, China, Japan, India and South Korea have taken a number of initiatives to support enterprises to develop new production facilities worldwide by modifying existing regulations, policies and huge amounts of funds.
European Chip Act: On February 8, 2022, the European Commission announced the Chip Act, which will help enterprises strengthen R&D, innovation and development in the semiconductor industry. A fund of approximately 43 billion euros ($46 billion) has been announced to support the initiative through public and private investment. It will help the EU achieve its target of 20% chip market share by 2030.
CHIPS for America Act: In January 2021, Congress passed the CHIPS Act to Create Beneficial Semiconductor Production Incentives for the United States. According to this initiative, the Senate passed the U.S. Innovation and Competition Act (USICA) in June 2021, providing $39 billion for the development of semiconductor production plans and $11.2 billion for research and development activities in the semiconductor industry.
Canada Semiconductor Action Plan: Roadmap to 2050: The Canadian Semiconductor Council has released a comprehensive action plan to change the domestic semiconductor industry. The action plan includes strengthening and diversifying the supply chain, developing onshore manufacturing, establishing unique specialization in design and research and development as well as electric vehicles (EVs), batteries and sensors, and promoting innovation through investment and government funding. The Canadian government will invest about 240 million dollars to support the country’s expansion in photonics and semiconductor manufacturing.
China’s $1.4 trillion investment plan aims to become a leader in the science and technology industry: the Chinese government has invested about $150 billion in China’s semiconductor industry in its “Fourteenth Five Year Plan” (2021-2025), and allocated $1.4 trillion to strategic industries, including semiconductor. In March 2021, the Shenzhen Municipal Government announced an investment of 2.3 billion US dollars and held 23% of the shares of SMIC International Integrated Circuit Manufacturing Co., Ltd., China’s leading wafer foundry.
Korean chip manufacturers will invest $47.36 billion to compete with global leading enterprises: Korean Semiconductor Industry Association announced its investment plan for 2022, including chip manufacturers such as Samsung Electronics and SK Hynix. South Korea plans to invest 510 trillion won (US $452 billion) in chips by 2030.
Japan has approved 774 billion yen (6.8 billion dollars) of domestic semiconductor investment funds: the program includes three parts, including 617 billion yen for innovative chip manufacturing capacity, 47 billion yen for traditional production (analog chips and power management components) and 11 billion yen for research and development of the next generation of silicon.
India has won a 20 billion dollar chip factory investment bid: India has received a proposal from VedantaFoxconn and the joint venture of Hon Hai Precision Industries, IGSS Ventures and ISMC to invest 13.6 billion dollars to establish a semiconductor chip factory. In addition, the government plans to invest $5.6 billion under SemiconIndia Program.