Science & Technology

Canada to Invest Millions to Build Chip Network

Canada intends to invest in building a national chip manufacturing network over the next few years.

Canada to Invest Millions to Build Chip Network

Ottawa plans to allocate financing in the amount of more than one hundred million Canadian dollars (1 Canadian dollar = 0.73 US dollars) for the implementation of the mentioned goals.

Last Thursday, July 4, Canadian Industry Minister François-Philippe Champagne announced the outlay of money from the federal Strategic Innovation Fund. These investments are intended to support a project worth 220 million Canadian dollars, which is led by the nonprofit research accelerator CMC Microsystems. The mentioned project aims to assist startups from Canada in commercializing technologies.

The program called the Fabrication of Integrated Components for the Internet’s Edge (Fabric) network, will subsidize prototype production in the specified country and provide participants with cheaper access to tools, software, and training.

The mentioned program also envisages funding in the amount of up to 10 million Canadian dollars for the development of hardware in the area of semiconductors, superconductors, photonics, and smart sensors.

CMC President Gordon Harling says that Fabric secures Canada’s future in the semiconductor industry and the advanced manufacturing sector.

The new funding is in addition to the joint investment of 187 million Canadian dollars announced in April by IBM and the governments of Canada and Quebec. In this case, the target is expanding IBM Canada’s chip packaging facility, which is located in Bromont, about 50 miles east of Montreal.

Paul Slaby, director of Canada’s Semiconductor Council, says there is no industrial strategy for the chip area in the country. Speaking at the International Economic Forum of the Americas conference in Montreal in June, he stated that the country’s government has begun to form a dedicated team for the mentioned sphere of activity.

It is worth noting that the Canadian leadership has recently been increasingly called upon to implement actions aimed at developing the semiconductor sector, which is currently in a kind of lagging position relative to the achievements of other states in the relevant area of operation. These calls are constructive and appropriate in a strategic context. The modern stage of human civilization’s ongoing history can be characterized as an era of high technology. The development, operation, and functioning of advanced technologies are impossible without the semiconductor sector. Currently, chips are a kind of basic element of the technology industry. This thesis is confirmed by the fact that without microcircuits, the functioning of artificial intelligence systems is impossible. This circumstance increases the value of the semiconductor sector also in the context of the fact that AI is the main technology of modernity, which many experts and futurologists name the driving force behind the global progress of the world of human existence as an operating space.

Also, own chip production is of great importance for the country against the background of the current state of affairs in the space of geopolitical relations. In the plane of international relations, there is nowadays a tendency for rising tension, which is on an upward trajectory. Currently, there is no definitive understanding of exactly what impact the present state of affairs will have on the configuration of the geopolitical space in the hereafter. When implementing a potentially pessimistic scenario of the political future of the world, a kind of block segmentation of countries may form, which will mean limiting or even ending economic, social, cultural, and other interactions between certain states. It is worth noting that the current geopolitical tensions already have practical consequences. One of the most significant examples of the deterioration of the situation in the area of international relations is the restriction of access of Chinese companies to advanced chips and equipment necessary for the production of relevant products. The relevant measures were introduced by the leadership of the United States. Against the background of these realities, the importance of technological sovereignty is actualized, implying the country’s ability to ensure the production of advanced products on its own, without relying on the supply of certain materials from other states. Also, the experience of the coronavirus pandemic has demonstrated a certain degree of vulnerability of international supply chains, which are subject to various kinds of failures in extreme or extraordinary conditions. Restrictive measures introduced against the background of a difficult sanitary and epidemiological situation have become a factor of negative impact on the supply system. The production process, based on what can be described as a global length which provides that the constituent elements from different geographical areas must connect at one functional point to obtain a result, is subject to failures associated with potential changes in the configuration of the state of affairs in the space of socio-political being and the political dimension of human civilization world.

Positive expectations regarding the prospects of the local semiconductor sector are currently widespread in Canada. At the same time, the opinion coexists with this point of view, according to which the government of the current Prime Minister Justin Trudeau is not making enough efforts to keep up with global competition, especially after the adoption of the US Chips Act in 2022. The law passed by Washington provides for the set aside of $39 billion in direct grants, plus loans and loan guarantees worth $75 billion for the development of semiconductor manufacturing in the United States.

Paul Slaby says that Canada seeks to establish itself in international trade by controlling one niche piece of the supply chain. In this context, the activities of ASML Holding NV, a Netherlands-based manufacturer of equipment for making microcircuits, were mentioned as an example.

Since the announcement of the Chips Act, more than 50 semiconductor projects have been implemented in the United States. Paul Slaby proposed that the current competition between Washington and Beijing offers an opportunity to align with American interests. According to the expert, Canada needs to conclude a semiconductor pact with the United States.

As we have reported earlier, South Korea Kicks Off $19 Billion of Chip Loans.

Serhii Mikhailov

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Serhii’s track record of study and work spans six years at the Faculty of Philology and eight years in the media, during which he has developed a deep understanding of various aspects of the industry and honed his writing skills; his areas of expertise include fintech, payments, cryptocurrency, and financial services, and he is constantly keeping a close eye on the latest developments and innovations in these fields, as he believes that they will have a significant impact on the future direction of the economy as a whole.