The European Union (EU) and Japan have agreed to enhance their cooperation on semiconductors, cybersecurity, and undersea cables, Reuters has reported. The EU’s Commissioner for Internal Market, Thierry Breton, is in Japan meeting with government officials and companies.
The two partners will monitor the chip supply chain and even facilitate the exchange of researchers and engineers to help advance the technological capabilities of both the EU and Japan quicker. Breton said that it’s really important “to secure the supply chain of semiconductors”.
In the case of semiconductors, they are so important to the world today. They are used in computers, phones, cars, and all of your smart appliances. Without enough of them, prices rise and make essential items like phones and computers more expensive.
The whole issue of the semiconductor supply chains and the over-reliance on Asia came to light during the COVID-19 pandemic when China implemented very strict lockdown measures as it pursued a zero-COVID policy.
To help diversify the supply chain, Germany and Italy have both lured Intel into their countries to build factories and create new jobs, albeit with subsidies to make up for the higher European wages. Intel has also expanded its operations in Israel, a neighbour of the EU.
According to Reuters, Japan is also offering subsidies to give its chip industry a boost. In Japan, the chip industry has an edge in materials and equipment but has steadily been losing global market share.
One of the semiconductor companies that the Japanese government is backing includes Rapidus Corporation. Breton is expected to meet up with that business on Tuesday to discuss collaboration between the EU and Japan.
While important steps are taking place right now, some of them, such as the factories that Intel has agreed to build, won’t bear fruit for several more years. It’s unclear how long it will take the EU-Japan partnership to be finalized but the partners have agreed to meet in Brussels in the first half of next year for more talks.