New attempt for German chip subsidies
billion euros have not been collected by Intel and others. The German government now wants to distribute a portion to other chip projects, in smaller tranches.
Who wants to do it again, who hasn't yet?
(Image: Maksim Shmeljov/Shutterstock.com)
Perhaps someone from the chip industry would like to collect money in Berlin after all. In this hope, the German government is planning to launch a new funding program for modern chip production. It is likely to be endowed with around two billion euros, if it comes to fruition.
The background to this is that Intel has paused the construction of its chip factory in Magdeburg, for which subsidies totaling almost ten billion euros were planned. In addition, Wolfspeed's wafer processing plant in Saarland is unlikely to come to fruition in the foreseeable future. In addition to EU subsidies, 360 million euros from federal funds and 155 million euros from the Saarland budget were to support the project. It would have been Germany's largest silicon carbide semiconductor plant.
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There is no shortage of ideas in Berlin for how to use the unclaimed money containers. In October, then Finance Minister Christian Lindner (FDP) called for the money to simply be put into the 2025 federal budget. At the beginning of November, Federal Economics Minister Robert Habeck (Greens) agreed with this proposal. Less than two weeks later, Habeck then ventilated a reduction in electricity grid fees of four billion euros over the next few years, financed from Intel's but-not-funded subsidies. His party colleague, Federal Chancellor Olaf Scholz, is also concerned about this relief, as the high tariffs are a disadvantage for both the business location and households.
The new Finance Minister Jörg Kukies, also a Social Democrat, has pointed out that the unclaimed subsidies could be used to prevent a budget freeze in the current year. After the break-up of the coalition government, it is not certain that the remaining minority government of SPD and Greens will be able to pass a supplementary budget in parliament. However, the reallocation of Intel subsidies also requires at least a majority in the Bundestag's Budget Committee.
New funding program with 2 billion euros
Now, however, the Ministry of Economic Affairs has confirmed that it will launch a new subsidy program for modern production capacities that significantly exceed the current state of the art. This is reported by BNN Bloomberg. There is talk of a low single-digit billion amount, according to Bloomberg around two billion euros. These funds are to be distributed across 10 to 15 projects, from wafer production to the assembly of microchips.
However, the current unstable situation in Berlin is also having an impact here. It remains to be seen who will be in charge of the Federal Ministry of Economics next year, as elections are scheduled for February. Subsidy applicants therefore cannot rely on the funding program being implemented in the way Habeck currently envisages.
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