‘Embarrassingly behind’: Is Canada doing enough on semiconductors?

Semiconductors are needed in almost all modern technology. Currently, about 90 per cent of leading-edge semiconductor chips are manufactured in Taiwan.

Canada has the “opportunity of a lifetime” to incorporate itself into the semiconductor supply chain, according to experts, as geopolitical tensions give the matter a sense of urgency.

Semiconductors are needed in almost all modern technology, from cellphones to electric cars to washing machines. Currently, about 90 per cent of leading-edge semiconductor chips are manufactured in Taiwan, according to Paul Slaby, managing director of Canada’s Semiconductor Council, a consortium of players within the industry. This creates a huge risk should China ever invade the island and block its export, he said.

Slaby told Global News that if the West was cut off from semiconductors produced in Taiwan in the next few years, we’d be “cooked.”

“It would be a disaster,” he said. “All of a sudden you would have no chips for your smartphones, so no more new smartphones.”

The COVID-19 pandemic brought a small taste of what chip shortages can do when restrictions caused a limited supply of cars and six-month waiting lists. An invasion of Taiwan would be even worse, Slaby said.

The prospect of such a nightmare scenario has been motivating North America to build its own semiconductor supply chain. The U.S. has already announced US$52.7 billion in funding for the industry with its CHIP and Science Act. The money is meant to fund the expansion of semiconductor manufacturing in the country.

Canada has put up hundreds of millions of dollars in funding, including $36 million in March and $250 million in 2022. But calls continue to do even more.

“We are embarrassingly behind,” Slaby said. “When I go to international forums and talk about it, it is hard to be serious when talking $250 million.”