Global Chip Shortages

Understanding the global chip shortages (Julia Hess, Jan-Peter Kleinhans, Stiftung Neue Verantwortung)

The global chip shortages and the resulting severe spillover damages in many sectors put the spotlight on questions of the health of the semiconductor supply chain. The struggle to cope with skyrocketing demand, natural disasters and lock-downs – all happening concurrently – reveals the supply chains fragility. Governments ask themselves what their role should and could be to strengthen the resilience of this vital supply chain, beyond mulling substantial subsidies to strengthen their domestic chip manufacturing.

From talks within the EU-US Trade and Technology Council (TTC), to US and South Korea exploring the idea of a joint supply chain task force and the US Bureau of Industry and Security asking chip companies a host of questions about their supply chains. These and many more strategies and initiatives are well-intentioned and understandable first steps to better understand to what extend governments can help in strengthening the resilience of this critical value chain. But to identify the root causes of these shortages, policy makers need to understand the dynamics within semiconductor manufacturing.

Understanding the global chip shortages | Stiftung Neue Verantwortung (SNV) (