In the latest development, the European Union (EU) has reached an agreement on a 43 billion euro ($47 billion) plan aimed at bolstering the semiconductor industry within its territory. The primary objective behind this plan is to catch up with the United States and Asia in the semiconductor sector and initiate a green industrial revolution, as reported by Reuters.

The proposal for the EU chip investment plan was initially put forth by the European Commission last year and has now received confirmation from Internal Market Commissioner Thierry Breton. The ultimate goal of this plan is to double the EU's global chip production share to 20% by the year 2030. To achieve this, the EU will be making adjustments to competition rules to allow for investments in the centers where semiconductor components are manufactured. Adequate funding has already been allocated within the existing budget to support this initiative.

Margrethe Vestager, the Vice President of the European Commission, emphasized the importance of chips in powering digital transformation, green initiatives, and healthcare systems in a tweet.

Since the announcement of the chip subsidy program last year, the EU has managed to attract over €100 billion in both public and private investments, according to an EU official.

However, analysts such as Paul Triolo, a technology and China expert at the Center for Strategic and International Studies in Washington, expressed doubts about the EU's ability to close the gap with its competitors in the semiconductor industry. Triolo pointed out that a crucial question the EU needs to address is how much of the supply chain supporting the semiconductor industry can be relocated to the EU and at what cost.

Initially, the European Commission proposed funding exclusively for cutting-edge chip manufacturing facilities. Nevertheless, EU governments and lawmakers have expanded the scope of the plan to encompass the entire value chain, including mature process chips and research and design facilities. This broadened approach seeks to strengthen the EU's semiconductor capabilities across various stages of the chip production process.

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