EU approves scheme to pump billions into microelectronics R&D

Targeted areas include sensors, high performance processors, AI processors, actuators, quantum computing, 5G/6G communications and technologies for secure data exchange

The EU has approved public funding totalling €8.1 billion by 14 member states for R&D into microelectronics and communications projects.

The 68 projects to be funded under the new scheme, called IPCEI ME/CT, will be undertaken by 56 companies and are aimed at developing novel technologies that are not currently available, particularly where they meet "objectives of a greener, digital, more secure, resilient and sovereign economy."

The projects supported will encompass chip design, tools, energy efficient microelectronics and novel manufacturing methods. Targeted areas include sensors, high performance processors, AI processors, actuators, quantum computing, 5G/6G communications and technologies for secure data exchange.

The EU anticipates that the initiative to create 8,700 jobs directly, plus many more indirectly, by the time the scheme winds up in 2032. It expects the €8.1 billion state funding to attract an additional €13.7 billion in private investment.

Funding for the scheme falls under state aid rules, where it is classified as an Important Project of Common European Interest (IPCEI). Where the market fails to deliver innovations in important areas with wide general interest, funding under IPCEIs is allowed to fill the gap.

The latest scheme follows earlier policy initiatives including the Digital Decade and the European Green Deal, and also the EU Chips Act which seeks to increase the bloc's share of the semiconductor market.

"This latest IPCEI approved today is yet another demonstration of the EU Chips Act already triggering considerable public and private investment across the European semiconductor value chain: from materials to design, from equipment to advanced packaging," said Thierry Breton, EU commissioner for internal market in a statement.

"By investing in our innovative companies, we are investing in Europe's technological and industrial leadership in semiconductors, as well as our security of supply and economic security."

Other countries and blocs are also piling large amounts of state funding into microelectronics and semiconductors, notably the US with its $280 billion CHIPS and Science Act and China, which is also reported to be supporting its semiconductor industry to the tune of hundreds of billions of dollars.

In May, the UK announced its own £1 billion National Semiconductor Strategy, focusing on chip design, R&D and compound semiconductors.