Should a Nation Enact a Chips Act?

Abstract

   The article examines the various strategies taken by countries, after facing the crisis of semiconductor shortage and the heat of geopolitical competition between the US and China.  This post-pandemic era brought in new challenge and high-tech breakthrough in the industry.  Both the US CHIPS ACT and EU Chips Act aim to strengthen the semiconductor supply chain resilience through generous financial support, as most of the subsidies will be invested in building up a domestic fab.  Japan also takes the same route, with an ambition to, in the future, be able to return to a dominant position in the global market.  The UK does not plan to build a domestic fab, according to its national strategy.  Instead, the UK will focus on the items that it already has competitive strengths, such as intellectual property (IP).  All these national efforts have a common ground.  Geopolitics is in the consideration of the semiconductor strategy.  The strategies must choose a side, and find like-minded allies to work with, in order to fully develop its set objectives.