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United We Prosper: Driving Sustainable Economic Growth Through US-EU Cooperation

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By Hendrik Bourgeois, Vice President, European Government Affairs 

Hendrik BourgeoisHendrik Bourgeois“More than ever, we need reliable, like-minded partners, who share common values”. This was my message last year before the third meeting of the EU-US Trade and Technology Council (TTC). At the end of a turbulent year – where Europe had endured events that rocked its economic and social foundations – we needed a rethink. Facing these events alone was not an option. To adapt and prevail in this new reality, I emphasized the need to work with our close partners to reinvigorate the transatlantic partnership.

Six months on, as we approach the fourth TTC meeting at the end of May, I am hopeful that the EU and US are doing just that. 

In the last few years, we have faced a global pandemic, supply chain crises, Russia’s unprovoked and abhorrent invasion of Ukraine, the ensuing energy crisis in Europe, and continued tensions in the Taiwan Strait. These tectonic shifts that have drastically changed the way we go about our lives, do business and trade with each other. It may look like the US and EU are turning inwards and face these crises in isolation – think about the paradigm of ‘a new Washington consensus’ that calls for a deep integration of the US’s international economic policy with its foreign policy; think also about the recent disagreements over arms deliveries to Ukraine, the US Inflation Reduction Act and the ensuing proposals for an EU Net Zero Industry Act, or export controls on semiconductor manufacturing equipment.

However, the future of the EU and US partnership may look much more promising. Both sides recognize the importance of aligning on fundamental economic questions and how to address them. And both agree on the need to decarbonize and reindustrialize our economies, diversify and strengthen our supply chains, invest heavily in our R&D, and build a skilled workforce.

In today’s new geo-economic reality, we need a more active and bold industrial policy on both sides of the Atlantic. And when we combine and complement our ambitions and policies, underpinned by our shared democratic values, there is a mutually beneficial opportunity to propel our industries forward.

What gives me an extra dose of optimism is that the US and EU acknowledge that semiconductors must be front and center in these efforts and that we already see tangible outcomes. Clearly, lawmakers on both sides of the Atlantic and from across the political spectrum understand the importance and value of the semiconductor industry to the whole economy.  Perhaps more importantly, both sides understand the importance of coordinating their approaches to semiconductor incentives; and what the transatlantic partners are doing in the semiconductor industry, is likely to be replicated in other sectors of strategic importance for our economies.

In March this year, President Biden and European Commission President Ursula von der Leyen pledged to build the clean energy economies and industrial bases we need for the future. I am proud to say that, at Intel, we are helping to deliver on this promise. Fuelled by the CHIPS for America Act, we are strengthening America’s semiconductor industrial base with two new fabs in Ohio. And we are hopeful that we will soon be able to replicate that in Europe with the EU Chips Act, which is expected to be formally adopted in the next few weeks.

As US National Security Advisor Jake Sullivan said recently, this is not about “picking winners and losers, nor about crowding out private investments” but about “crowding in private investments and making them in sectors vital to our national wellbeing.” I couldn’t agree more. The US and EU have, over the past year, taken decisive steps to secure their industrial well-being for decades to come.

While the steps already taken to deliver on these commitments have mainly been unilateral, we can achieve more than the sum of our individual initiatives by combining our efforts through a committed transatlantic partnership. The TTC has already broken this ground. Establishing a joint early warning mechanism for semiconductor supply shortages and setting up a channel for sharing information on industrial subsidies are the all-important first steps towards more comprehensive cooperation in the semiconductor sector. But the TTC should have the ambition to go further and capitalize on common opportunities. Going into the TTC’s fourth meeting, I hope to see the number of joint US-EU initiatives increase and bring more significant benefits to the international semiconductor ecosystem.

The US and the EU are once again speaking with a united voice on important matters of economic policy. This is the best recipe for our future prosperity. And the best way forward for the transatlantic semiconductor sector.