Germany decided to subsidize the national semiconductor industry

Intel’s decision to delay for a couple of years the start of construction of two enterprises in Magdeburg, Germany, worth a total of 30 billion euros, clearly disappointed local authorities, and therefore the German government this week announced its readiness to support the national semiconductor industry with additional subsidies.

Image source: NXP Semiconductors

Their size, however, as Bloomberg reports, citing informed sources, will be limited to only a couple of billion euros, but for the German economy, which is not in the best shape, this is quite a lot. According to German officials, the funds will be used to create more modern production facilities compared to existing ones. Official representatives of the German Ministry of Economy refused to name the exact amount of subsidies, but explained that it would be measured in several billion euros.

Officials have already appealed to chip manufacturers to apply for targeted subsidies. The new German government is due to be elected in February next year, so continuity in government budget planning cannot be guaranteed. This creates significant uncertainty around the whole subsidy idea. Ideally, the German authorities would like to direct subsidies to support from 10 to 15 projects in various fields, one way or another related to the production of chips in the country. The initiative aims to create a strong and sustainable microelectronics manufacturing ecosystem in Germany and Europe, as ministry officials explain.