From left to right: Executive Vice President Margrethe Vestager, EIB Vice-President Teresa Czerwińska. European Commissioner for Internal Market Thierry Breton
Today, the EIB Group and the European Commission signed a statement in support of the European semiconductor ecosystem.
In the context of the European Chips Act, the two institutions aim to work more closely on future investment initiatives. The EIB Group is planning to increase and further diversify its support for the broader European semiconductor ecosystem, with a focus on the following product categories:
- Equity financing to provide venture capital and growth funds, supporting scale-ups and small and medium-sized companies in developing and commercialising semiconductor technologies and solutions to increase their capabilities and market expansion.
- Blended financing for projects supported under the Chips for Europe initiative.
- Loans and guarantees to support the setup and expansion of advanced production facilities as well as chip design activities.
- Complementary support activities for the semiconductor sector, such as advisory services and actions to raise awareness and share expertise.
In the last five years, the EIB Group has financed semiconductor projects with €1.9 billion across the European Union, mobilising €5.8 billion of investments. In February 2022, the EIB signed its most recent semiconductor project, backing French growth company Menta, a pioneer in the European reprogrammable semiconductor industry, with a €7.5 million venture debt loan.
“With our partners from the European Commission, we aim to increase significantly our support for the European semiconductor ecosystem – supporting research, development and innovation, production and design, as well as novel technologies and innovative smaller and medium-sized business,” said EIB Vice-President Teresa Czerwińska. “Only if we act at a pan-European level can we reach the magnitude of investment we need to become more competitive and reduce critical dependency when it comes to semiconductor chips. The EIB Group, as one of Europe’s largest innovation investors, stands ready to deliver on the European Union’s ambitions in this sector.”
The European semiconductor ecosystem
Semiconductor chips are the essential building blocks of digital products. They are central to a modern economy and society. However, over the past year, the European Union has witnessed unprecedented disruptions in supply in the semiconductor sector. The current shortage is a symptom of structural problems in the global supply chain, which is geographically very concentrated in some key segments. At the same time, the semiconductor chips market is growing exponentially due to the accelerating digitalisation of the economy and society.
Europe has the ambition to reach at least 20%, in value terms, of the world’s production of cutting-edge and sustainable semiconductors by 2030, building on its strengths in research and equipment manufacturing, analogue chip design and low-power technology. To achieve this goal, Europe will have to accelerate its investment in capital-intensive testing, along with pilot and production capabilities, including in leading edge technologies.
The semiconductors sector faces challenges in attracting sufficient financing in Europe because of high capital intensity, high risks, the technical and managerial complexity of the projects and the longer timeframes involved in securing a return on investment.
Background
The European Investment Bank Group is the lending arm of the European Union. It is the biggest multilateral financial institution in the world and one of the largest providers of innovation finance in Europe. Find out more here.
