According to the Semiconductor Industry Association (SIA), global semiconductor sales in the third quarter of 2024 increased 23.2% year-on-year and 10.7% sequentially. This growth was driven by strong demand in areas such as artificial intelligence, big data and new energy vehicles. Countries and regions across the globe, including China, the US, India, South Korea, Japan, the EU, and Southeast Asia, are investing heavily in the semiconductor industry to increase their control over the chip supply chain and secure a stronger position in the global market. Recently, countries such as the EU, Japan and South Korea have announced new initiatives to advance their semiconductor development efforts.
EU: €133 Million to Ramp Up Optical Chips
The Dutch Ministry of Economy said that the EU will invest 133 million euros to build an optical chip pilot line in the Netherlands. If things go well, the pilot line is expected to start construction in mid-2025. At present, the Dutch National Institute of Applied Sciences, Eindhoven University of Technology, University of Twente has been awarded the contract to build this production line, Smart Photonics and other Dutch companies will also participate in this project.
The Dutch Minister of Economy, Dirk Beljaarts, said that photonics is a technology of strategic importance, with the goal of gaining a strong competitive advantage for Europe from knowledge, innovation, supply chain to the final product.
Last year, several of Europe’s largest photonic computer chip company executives had called on the EU to provide 4.25 billion euros in funding to support the photonic chip industry.
Unlike electronic chips that rely on electrons to transmit information, optical chips rely mainly on photons to transmit information. With less interference between photons, the computational density is two orders of magnitude higher than that of electronic chips, but the energy consumption is two orders of magnitude lower, which makes optical chips very suitable for long-distance transmission of large amounts of data, and strongly supports the high-quality development of digital economy-related industries such as new-generation network communications, artificial intelligence, and intelligent networked vehicles.
With the rapid development of cloud computing, big data, artificial intelligence technology and the Internet of Everything, the requirements for data transmission speed, efficiency and energy consumption are getting higher and higher, and the optical chip market size continues to grow. the global optical chip market size of about 2.78 billion U.S. dollars in 2023, an increase of 14.4% over the previous year, is expected to reach 3.17 billion U.S. dollars in 2024.
Japan: Heavy Bet on Semiconductors
On 11 November, Japanese Prime Minister Shigeru Ishiba said that the Japanese government will provide at least 10 trillion yen (about $65 billion) by fiscal year 2030 to support the development of semiconductor and artificial intelligence industries.
The plan is part of a larger plan to be approved by the Japanese government on 22 November, a larger plan that also includes a total investment in the semiconductor industry of 50 trillion yen over the next 10 years.
One of the beneficiaries of the plan is Rapidus, the state-backed, force-producing advanced chips, and it is understood that the assistance will take the form of grants, investments by government affiliates, and debt guarantees for loans by private financial groups. Shigeru Ishiba stressed that Japan will not issue deficit government bonds to fund the programme. (A deficit-covering bond is a type of bond issued to cover a shortfall in state revenues.)
The draft plan drawn up by Japan is said to be aimed at strengthening the development of artificial intelligence and the semiconductor industry, with a vision stretching to FY2030, and is expected to have an overall economic impact of ¥160 trillion.
South Korea: Pushing a Special Law to Revitalize Semiconductors
On 8 June this year, the leader of South Korea’s ruling People’s Power Party, Han Dong-hoon, demonstrated his party’s commitment to the development of the semiconductor industry when he declared that without semiconductors, South Korea’s ‘upward mobility’ (the growth of the national economy) would not be possible. This statement set the stage for a series of events that culminated in the proposal of a special law on semiconductors on 17 November.11 Bill 11 was intended to provide financial support and allow for an exception to the 52-hour work week.
On 10 November, Kim Sang-hoon, chairman of the policy committee of the Korean People’s Power Party (KPP), held a press conference at the Yeouido National Assembly in Seoul. He announced that ‘we will propose elements to coordinate with government departments,’ indicating that the bill will include provisions for financial support and workweek exceptions. The proposed law, put forward by Lee Chul-kyu, chairman of the National Assembly Committee on Industry, Trade and Energy, includes subsidies for the semiconductor industry as well as the establishment of the Presidential Semiconductor Industry Strengthening Committee and the Semiconductor Innovation Support Group under the Ministry of National Defence. Trade, Industry and Energy.
The proposed special law on semiconductors represents a strategic effort to support Korea’s semiconductor industry in the face of intense global competition, as both the North and the South work to reach an agreement. The outcome of these negotiations will have a significant impact on the country’s economic future and its place in the global technology landscape.
Vietnam: Streamlining Semiconductor Investment
Vietnam’s National Assembly is considering simplifying procedures for investing in semiconductors and other industries to attract more foreign companies, said Nguyen Chi Dung, Minister of Planning and Investment.
In his opening speech at SEMIExpo Vietnam 2024 in Vietnam, local Minister of Planning and Investment Nguyen Chi Dung emphasized that the show is a milestone in Vietnam’s participation in the global value chain of the semiconductor industry, which is a major driver of modern technology and the foundation of the digital economy. He said complex geopolitical developments around the world have prompted countries to diversify their supply chains and seek more stable and sustainable sources of parts supply.
The Vietnamese government has issued the Strategy for the Development of the Semiconductor Industry to 2030 and Vision 2050, aiming to make Vietnam a global semiconductor workforce center by 2030 and a global center for semiconductor and electronics technology by 2040.
Vietnam has gradually become a favored destination for investors in the semiconductor sector, thanks to huge advantages such as political stability, sustained growth in the digital economy over the years, and a young and abundant workforce. Vietnam aims not only to participate in the global value chain, but also to build an advanced and attractive semiconductor industry ecosystem in the region and globally.
In summary, the semiconductor industry is ushering in the latest trends, with growth in market size and breakthroughs in technological innovation bringing unprecedented opportunities and challenges to the industry. With the development of the global economy and the continuous evolution of technology, the semiconductor industry is also expected to welcome new growth opportunities by 2025. The application of artificial intelligence, deep learning and other emerging technologies will provide a continuous impetus to the semiconductor industry. Major semiconductor companies should strengthen their focus and investment in emerging technologies in product development to seize market opportunities while maintaining flexibility to adapt to changes in market demand and achieve sustainable growth.
