Chips Act 2.0: ambition must now translate into reality

At the heart of the package lies the Chips Act 2.0, which aims to strengthen Europe’s semiconductor ecosystem, improve supply chain resilience, boost competitiveness, and stimulate demand. Building on the first Chips Act, the proposal acknowledges persistent structural weaknesses. Europe remains highly dependent on third countries, particularly in advanced manufacturing and semiconductors design — two strategic segments where the EU continues to lag behind.
 
The new initiative is more closely aligned with the EU’s “Made in Europe” ambitions, with a stronger focus on industrial capacity, coordination and demand creation. It proposes a broader range of tools, including:

  • Improved framework conditions for investment,
  • Strengthened crisis preparedness mechanisms,
  • The use of public procurement and State aid as strategic levers,
  • The development of competence centres and a European supply chain platform,
  • New coordination structures, including a European Semiconductor Board and a reinforced“ Chips for Europe Initiative 2.0”.

However, important questions remain.

Experience with the first Chips Act has already shown that ambition alone is not enough. The EU has struggled to translate political commitments into tangible industrial capacity on the ground, and to ensure that investments strengthen the entire value chain rather than focusing on a limited number of flagship projects. In this context, public support must come with clear conditions. If semiconductor manufacturers are to benefit from European or national public funding, they should be required to respect social conditionalities, including workers’ rights, collective bargaining and high labour standards, commit to production in Europe, and strengthen local supply chains. Turning “Made in Europe” into reality will require much more than new instruments. It will depend on sustained and coordinated public investment, a coherent strategy linking design, production and demand, and concrete measures to ensure that industrial development benefits all regions.

For industriAll Europe, the key question is whether this renewed framework will genuinely deliver resilient supply chains, strategic autonomy and quality industrial jobs, or whether it risks repeating the shortcomings identified in the first Chips Act.

Cloud and AI Development Act: scaling up European capacity

The proposed Cloud and AI Development Act (CADA) aims to strengthen Europe’s capacity in cloud and artificial intelligence, while reducing strategic dependencies. The initiative includes plans to accelerate the deployment of data centres across the Union, develop sovereign cloud and AI services for the public sector, and introduce EU-level criteria for trusted providers. It also expands the use of strategic public procurement and requires Member States to develop national strategies and infrastructure. 

The creation of a Eurocloud federation is intended to connect these efforts at European level, although its effectiveness will depend on coordination, investment and implementation at national level.

Open source as a pillar of digital sovereignty

The EU Open Source Strategy recognises the strategic importance of open source technologies in reducing dependencies across the digital value chain. 

By supporting interoperability, transparency and shared innovation, it positions open source as a key building block of Europe’s digital ecosystem and a complementary approach to industrial policy.

Digitalisation and AI in energy: linking tech sovereignty and transition

The package also includes a Strategic Roadmap for Digitalisation and AI in the energy sector, underlining the role of digital technologies in strengthening energy security, competitiveness and decarbonisation. It highlights priorities such as smart grids, sovereign AI models and the development of a European Energy Data Space — all crucial elements for managing the green transition and ensuring a resilient energy system.

A necessary step — but delivery will be decisive

The Tech Sovereignty Package confirms a growing recognition that digital policy is also industrial policy, with direct implications for jobs, investment and Europe’s strategic autonomy.

"However, the real challenge now lies in delivery. Ensuring that this package leads to concrete industrial development, resilient supply chains and quality jobs across Europe will require sustained political commitment, coordinated investment, and a stronger focus on implementation — including clear social and industrial conditionalities attached to public support. For industriAll Europe, the priority remains clear: technological sovereignty must go hand in hand with a strong industrial base, fair conditions for workers, and tangible benefits across all regions of Europe" said Isabelle Barthes, industriAll Europe's Deputy General Secretary