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EU’s Chips Ambition Meets Budget Reality

relates to EU’s Chips Ambition Meets Budget Reality

Welcome to the Brussels Edition, Bloomberg’s daily briefing on what matters most in the heart of the European Union.

Brussels will today announce plans to turn the EU into a semiconductor powerhouse, rivaling recent efforts out of Washington. The bloc wants to produce 20% of the world’s chips by 2030, a move that requires it to quadruple its semiconductor production in just eight years. Commission President Ursula von der Leyen said Europe’s “Chips Act” will include state-aid rules to put public money toward “first of a kind” production sites coupled with a 42 billion-euro budget. But debates in the Commission have come down to the wire over how to make funds available. When the final proposal is unveiled today, it’s likely to show that the legislation will have just over 5 billion euros earmarked for the project — scrounged from existing budget items. It will depend heavily on member countries’ proposals and will do little to ease tensions between the heads of industrial and competition policy at the EU’s executive branch.

— Jillian Deutsch

Pipeline Threat | U.S. President Joe Biden said the controversial Nord Stream 2 natural gas pipeline would be stopped if Russia orders an invasion of Ukraine. German Chancellor Olaf Scholz was uncharacteristically forceful in warning about the potential price to the Kremlin, which has repeatedly denied that it plans to attack Ukraine. Here’s the latest on the situation.