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Self-Sufficiency and the Semiconductor Shortage

by Chris Taylor | 5月 20, 2021

Even before the COVID-19 pandemic, trade sanctions against China aimed at cutting off semiconductors set the stage for today’s global semiconductor shortage.  In mid-2021, the continuing semiconductor disruptions underscored the importance of chips as key to economic growth and security for the U.S., China, EU, S. Korea, Japan, and India, and these countries increased efforts to foster their own semiconductor ecosystems.

Does semiconductor self-sufficiency make sense?  While free and open trade can benefit all, especially with a supply chain now as spread out across the globe as semiconductors, we live in an era in which unexpected disruptions to trade occur and will continue to occur.  Increasing global population pressure, shortages of natural resources, pandemics, and global warming will probably continue, leading to more disruptions of international trade in the future.

One big challenge is that complete semiconductor self-sufficiency for any country would require huge investment and many years of concerted effort.  Instead of just throwing money at the problem, countries need to target incentives and direct investment carefully to attain realistic outcomes.  This means a mix of investments in mature and leading-edge fabrication process technologies depending on each country’s needs and must also consider access to critical parts of the supply chain ranging from electronic design assistance (EDA) to semiconductor equipment, packaging and test.  

For more on this topic, you can download a complimentary report here.

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