Semiconductor Crisis Strengthens Cooperation Between EU And USA

Abdul Ghani

The European Union and the United States had feared a race for subsidies in the semiconductor crisis. Now both sides praise the cooperation. The European Union (EU) and the USA want to prevent a race for state subsidies for microchip production through closer cooperation. Both the EU and the US want to invest tens of billions in the production of semiconductors in the coming years. This had aroused fears that the two economic powerhouses would continue to outdo each other in the fight to attract companies and waste taxpayers' money on it. The partners now want to know about the purpose, form, and amount of the planned subsidies, as long as this does not concern confidential information, as was announced on Monday.
Both sides praise transatlantic cooperation.Image by Open Democracy from Flickr

In addition, an early warning system is to be set up to point out the dangers of a semiconductor shortage and subsidy race. Exactly what this looks like is not in the joint declaration at the second meeting of the new European-American Trade and Technology Council in Paris. In June 2021, the EU and the US agreed to set up the Council.

Subsidy Competition Previously Feared

A first meeting at the end of September 2021 was overshadowed by the fact that Washington had previously negotiated a new security pact for the Indo-Pacific region with Great Britain and Australia behind the EU's back. Now EU Commission President Ursula von der Leyen and US President Joe Biden have described the Council as a "pillar of transatlantic cooperation".

For German companies it is essential that trade disputes are reduced and new conflicts are prevented, said Volker Treier, head of foreign trade at the Association of German Chambers of Industry and Commerce (DIHK), the German Press Agency. Especially when there is a tendency to break away from China, better market access to the US market for companies from Germany is urgently needed.

In addition to semiconductor production, the EU and the US also want to work more closely together in the areas of trade, the environment, and food safety. Both sides also praised each other for their reactions to the Russian war against Ukraine. Even before that, the automotive industry had to react to another crisis. In January 2021, the industry association VDA began talks with the federal government to ensure the supply of semiconductors. With the CHIPS Act, the USA wants to become more independent in microchip production.

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Member Of Freelancers Union (USA), Freelance Writer!, and Digital Creator. Ghani Mengal is an enthusiast Freelance blogger and digital marketer. His content has been published and featured on many popular blogs, websites, and publications. Including TeelFeed,, Data-Driven Investor, TextSniper, Scientific Publication The Predict, The Startup, The Ascent, Heart Affairs, Illumination, And The List goes on.


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