From South Korea to US, here#39;s how nations stepping up to boost supply of semiconductors

Silicon wafer in die attach machine in semiconductor manufacturing [Image: Shutterstock]

Many countries are stepping up efforts to boost supply of semiconductors, with plans to spend large amounts of capital.

Semiconductors, or chips, are used in several devices, such as smartphones, laptops and electric vehicles. There is an ongoing global shortage of chips that could last till 2022 or even go into 2023, with the demand exceeding supply.

“In the ongoing battle for dominance in the technology field, all nations are jockeying for that all-important designation as the key supplier to the world,” Forrester’s O’Donnell told CNBC.

“South Korea, Japan, the US, Taiwan, the EU, and China all covet that gold medal in the Tech Olympics podium,” he said.

Here’s a round-up of the funding plans announced by some countries:

> South Korea on May 13 said it has committed $ 452 billion will be invested in chips by 2030, of which majority will come from private companies.

The country also plans to assist the sector through tax breaks, finance, and infrastructure, as a part of its “K-Semiconductor Strategy”.

Abishur Prakash, a geopolitical specialist at the Center for Innovating the Future, a consulting firm, told CNBC that it’s “a wartime-like effort by South Korea to build future security and independence.”

> $ 50 billion of US President Joe Biden’s $ 2 trillion infrastructure proposal, which was announced in March, has been set aside for the semiconductor industry.

> The European Union in March said it wants 20 percent of the world’s semiconductors to be manufactured in Europe by 2030, double of the 10 percent in 2010.

“It is our proposed level of ambition that by 2030 the production of cutting-edge and sustainable semiconductors in Europe including processors is at least 20 percent of world production in value,” the European Commission said in a document to lawmakers in March.

> China, too, is planning to spend on high-tech industries, with a focus on semiconductors, CNBC reported.