China

Each quarter SEMI recognizes the longstanding commitment and support of member companies as they reach a new membership milestone.

On June 8, the White House released its report directed under the February 24 Executive Order 14017 to secure America’s supply chains. Among those critical products, the Department of Commerce conducted the review of semiconductor manufacturing and advanced packaging.

Recent semiconductor supply chain constraints have drawn the attention of Washington policymakers at every level. Exasperated by the global pandemic, customers of semiconductor manufacturers have sounded the alarm about the chip shortage and the downstream consequences for end-user companies and consumers. Global automakers have suffered the brunt of the impact, shuttering factories and slashing vehicle production. Last month President Biden issued an Executive Order (EO) to review and secure America’s supply chains. The stated goals of this review are to revitalize and rebuild domestic manufacturing capacity, maintain America’s competitive edge in research and development, and create well-paying jobs. Under the EO, the U.S. will also work more closely with allies to strengthen supply chains. The EO directs supply chain reviews on several critical segments, including semiconductor manufacturing and advanced packaging. The Department of Commerce will identify risks throughout the U.S. semiconductor supply chain and make policy recommendations to address those risks within 100 days of the EO’s issuance. In coordination with the White House, Congress is contemplating a variety of measures to address supply chain issues. Recently, the Senate Finance Committee held a hearing on the effects of the U.S. tax code on domestic manufacturing. Both Chairman Ron Wyden (D-OR) and Ranking Member Mike Crapo (R-ID) highlighted their desire for bipartisan cooperation to use the economic tools within the jurisdiction of the committee to bolster domestic manufacturing. The committee discussed two pieces of legislation that would provide significant incentives to domestic manufacturing of semiconductors. The first was the investment tax credit (ITC) for semiconductor manufacturing that was included in last year’s CHIPS for America Act but not with the other semiconductor incentives in the FY2021 National Defense Authorization Act (NDAA). An ITC would provide predictability and stability in the U.S. tax code to promote large, long-term investments for the industry. The second was the American Innovation and Jobs Act, which repeals the R D amortization requirement set to go into effect in 2022 and expands the refundable tax credit for startups and small businesses. Enhancing domestic incentives for R D and manufacturing is an important step in putting the U.S. on equal footing with other countries and would promote its continued leadership in the chip industry. Senate Majority Leader Chuck Schumer (D-NY) has announced his intention to craft a package of measures to strengthen U.S. competitiveness vis-a-vis China. The package reportedly would include funding for the microelectronics R D and Commerce grant programs that were passed in the NDAA. The Senate plans to take up the legislation in April. SEMI applauds the renewed focus on incentivizing domestic manufacturing and R D for an industry that enables countless technologies, drives innovation in sectors throughout the U.S. economy, and powers the electronic systems essential to critical infrastructure and defense systems. We look forward to working with policymakers in Congress and the Administration to support the entire domestic semiconductor ecosystem. Kimberly Ekmark is director of Public Policy and Advocacy at SEMI

Humanity has survived almost unimaginable challenges over the past 5,000 years of documented human history. From war, famine and natural disasters to the first global pandemic in the last 100 years, more often than not, people have relied on one another to survive and thrive again. As the industry association representing the global microelectronics industry, SEMI has similarly made collaboration and community integral to the fabric of its organization. From helping members to succeed through the COVID-19 pandemic to facilitating member-driven industry standards around environmental health and safety, materials, and manufacturing capabilities, this approach shows members that standing together is better than standing alone.On the eve of the 50th annual SEMICON West (July 20-23, 2020) — the first virtual edition in SEMI’s history — I spoke with SEMI’s vice president of technology communities, Michael Ciesinski, about the role of SEMI in tackling big challenges through an active member community intent on solving problems through collaboration.SEMI: How long have you worked with SEMI and in what capacity?Ciesinski: In January 2016, I started my second tour at SEMI when FlexTech, the industry consortium I’d been leading, became SEMI’s first strategic partner. Nearly two years into that role, SEMI President CEO Ajit Manocha asked me to form Technology Communities to engage members with common interests. After FlexTech, we brought on the Fab Owners Alliance, then MEMS Sensors Industry Group (MSIG), and later the Electronic System Design Alliance (ESD Alliance).SEMI now has more than 20 communities in all, including Smart MedTech, Smart Data AI, Smart Manufacturing, Electronic Materials, and Integrated Packaging, Assembly and Test.SEMI: What is your role with Technology Communities — and how do members stand to benefit?Ciesinski: The leadership of Technology Communities ensures that SEMI’s benefits and services align to our members’ interests so we can provide member benefits that matter most. This spans forming communities where people hold common interests (e.g., advanced packaging) to facilitating standards that will promote intelligence in manufacturing (e.g., data standards for AI and machine learning) as well as providing R D funding.I’m especially proud that over the past three years, SEMI has brought more than $40 million in R D funding to our members, with most grants in the $500,000-$1 million range. We’ve been especially successful in securing funding in flexible hybrid electronics (FHE) through U.S. Army Research Laboratories (ARL), a model we first developed through FlexTech.Two recent recipients of FHE funding, GE Research and ITN Energy Systems, show how the grants are spawning partnership opportunities among commercial enterprises, R D organizations and universities. In developing lightweight, non-invasive wearables, including a human-performance sweat-monitoring patch that remotely analyzes sweat to detect hydration levels and other vital signs, GE Research is using key components such as sensors and lightweight batteries in its designs.ITN Energy Systems designed a flexible all-solid-state lithium battery that’s printed on light, flexible substrates to power small and incredibly thin applications.Universities are also benefiting by plugging into the SEMI ecosystem. In fact, 40-50 percent of funded projects are seeding commercialization by universities. This is another validation that SEMI’s collaborative, community approach to microelectronics is working.SEMI: Position, Timing and Navigation (PNT) is another hot area where SEMI has secured ARL funding. What makes this funding different and why is it important?Ciesinski: The PNT grant makes ARL funding available to the MEMS Sensors Industry Group (MSIG) members through SEMI for the first time. If you’ve ever lost GPS signal while coming out of a tunnel, you know how frustrating that is. For us, that’s an inconvenience, but for a healthcare worker in a remote location who’s waiting for a delivery of medication by drone, it could be life-critical. While that’s just one example of why we need PNT to operate when GPS isn’t available, I can imagine dozens of other important dual-use cases, including autonomous driving.SEMI: How else do Technology Communities benefit under SEMI?Ciesinski: Technology Communities need access to diverse resources to spur continuous innovation. Electronic Materials Group participants, for example, need to stay informed on regulations coming out of Asia, the U.S. and Europe that may affect their businesses. Where else other than SEMI can like-minded stakeholders congregate with people up and down the supply chain to determine whether industry-wide action is needed on regulation?SEMI: What is the importance of SEMI’s global footprint?Ciesinski: I’ve worked with many associations and managed major industry consortia. The clear advantage of SEMI is our global footprint. And that’s vital because microelectronics is a global industry involving a multitude of stakeholders that play essential roles in the supply chain.Let’s say you want to discuss EU regulations on hazardous chemicals. Rather than decipher these complexities alone, you can pick up the phone to speak with someone on SEMI’s European team to learn what’s critical.What if you’d like more information on the 20-plus new fabs that are going up in China? You can explore that question with our SEMI China or SEMI Industry Research and Statistics teams.SEMI: How has SEMI evolved over the years?Ciesinski: SEMI has a long history of providing what the industry cares about. We started in trade shows and pivoted to industry standards. We began with small silicon wafers and wafer carriers, and now within the span of 50 years we’re working on data-format standards that will support the application of AI and machine learning (ML) in the semiconductor industry.While highly varied today, data-format standards will help component manufacturers refine processes to create more efficient solutions. This ARL-funded program, which pairs SEMI members with the grant recipient, Cornell University, may offer dramatic gains in the productivity of semiconductor manufacturing.SEMI: How does SEMI’s approach to COVID-19 reflect core values of collaboration and community?Ciesinski: Together with Ajit Manocha, CMO Terry Tsao and other team members at SEMI, we pulled together a task force to help SEMI members navigate the pandemic.We tapped two existing groups, Environment, Health and Safety (EHS) and Information Technology Leadership (ITL) from the start, documenting their strategic and tactical approaches to help all members through the COVID-19 resource section of our website. The EHS section provides tips on facilities and meetings, employee policies, business travel and communications, while the ITL section lists insights on computing hardware for staff, licensing, networks, security and employee policies.Our EHS leadership team, which includes Entegris, Axcelis, Versum, and Intel, immediately started sharing best practices for sanitizing facilities. As a result of team meetings, SEMI EHS shared best practices on keeping the workforce remote and guidelines for returning people to work safely. From securing PPE and safeguarding employees and visitors by performing thermal scanning to outlining communications around potential employee exposures, EHS has provided meaningful resources for the benefit of all members.SEMI also took immediate steps in the area of advocacy. Our advocacy team in Washington, D.C., together with regional SEMI presidents around the world, have ensured that semiconductor facilities were and still are considered essential businesses in the U.S., Europe and Asia. That’s because microelectronics are foundational to fighting the pandemic.Microfluidics are critical to the Reverse Transcription (RT) Polymerase Chain Reaction (PCR) tests most commonly used for COVID-19. Sensors are embedded in the pulse oximeters that allow patients and healthcare professionals to monitor a vital rubric: oxygen saturation level. If oxygen saturation level drops into the low 90 percentiles or below, it may be time to go to the hospital for treatment.Microcontroller units are essential components in a wide range of hospital equipment, including the ventilators that may make the difference between life and death in the most seriously ill patients.SEMI: How can the ingenuity realized through microelectronics continue to help us tackle other big problems? Ciesinski: We have MEMS and sensors to thank for distributed intelligence, giving us the ability to put sensors anywhere, locally based in the field or in the packaging house.Food production is a prime example. Leveraging miniaturized wirelessly connected sensors, we can trace food through the entire production lifecycle, from the seed in the ground to the food in the warehouse and, ultimately, to the product that lands on the table.From larger enterprise such as IBM Food Trust to small startups, we’re using MEMS and sensors to improve crop yields so we can feed a human population that’s growing each year.There’s a sustainability piece as well. We’re using MEMS and sensors to reduce the amount of fertilizer or other nutrients or chemicals in the soil. That’s good for the environment and for the agricultural workers who labor in the fields.MEMS and sensors can also condense the time it takes to perform a specific task, conserving human resources.SEMI: Where do you think SEMI will go in the next decade?Ciesinski: Ten years from now, I believe we will still have our global footprint in place. I expect it will expand, particularly in Asia.We may also expand into new areas such as Latin America and Central America, which would provide at least two major benefits: People working in microelectronics would, I hope, have access to better quality of life. And diversifying the supply chain would allow nations and regions to have more control over the products they need, from PPE to medications, which may help us to better manage through the next pandemic.I am also hopeful that SEMI will be on the leading edge of helping our members communicate in much different fashion from what we have today. We’re already expanding beyond the paradigm of in-person meetings for standards meetings and conferences. As we move forward, I think we’ll see a hybrid solution to doing business, combining in-person meetings with virtual conferences and digital content that’s available 24/7.Whatever changes we see in SEMI, I’m confident that we will continue to see a global footprint in an industry association that prioritizes connections among members.Engage in the SEMI experience at upcoming SEMICON WestRegister today to hear from keynote speakers such as environmental advocate and former U.S. Vice President Al Gore, futurist and author Steve Brown, and IBM Research senior vice president and director Dr. John E. Kelly III, and Lea Gabrielle, special envoy of the Global Engagement Center for the U.S. State Department, at SEMICON West , July 20-23, 2020. Content will be live streamed and available on-demand. Michael Ciesinski is vice president of Technology Communities for SEMI, the global microelectronics industry association, appointed in August 2018. At SEMI, he directs activity for more than 20 industry groups, oversees the association’s R D funding program, and develops new technology initiatives to serve SEMI’s 2,400 members. Prior to re-joining SEMI, Ciesinski was president/CEO of FlexTech Alliance, an industry consortium focused on new methods of creating electronics. From 1995-2008, Ciesinski served in a similar role at the U.S. Display Consortium (USDC), a private/public partnership chartered with building the infrastructure for electronic display and flexible electronics manufacturing. Both FlexTech and USDC annually sponsor multimillion dollar technology development programs and provide industry technical, financial and market services. Ciesinski is a graduate of the University of Albany, NY, and a former member of the Dean’s Advisory Committee at California Polytechnic State University.Maria Vetrano is a PR consultant at SEMI.

Global and regional forces shaping the $2 trillion electronics industry have intensified more in the past few years than at any other time I can recall. The uncertainty bred by trade wars, corporate tax changes, new environmental regulations, immigration issues and STEM talent shortages is vexing the global microelectronics supply chain as companies shift investments and operational strategies to adjust to the unrelenting change and new realities with heightened urgency.In our industry, an increasingly dynamic world requires a more determined and strategic approach to advocacy. To meet the industry’s rapidly evolving needs, SEMI is transforming its global advocacy initiatives and programs. In the past 18 months, we have honed the focus of SEMI Global Advocacy to better serve member interests and needs, respond more quickly to fast-moving geopolitical developments, and deliver more value to help spur growth across the end-to-end electronics supply chain.Most importantly, SEMI Global Advocacy is now much more forward-looking and proactive. We have expanded our focus from primarily U.S. and independent regional issues to global affairs, allowing us to better leverage the power of our worldwide platforms. Organizationally, SEMI continues to add specialized staff advocates and calibrate its operational and member-driven engagement models to increase their involvement. There will be more to come, and with your continued support, we’ll be in a stronger position to meet your needs. Thank you!Strengthening the industry’s voiceThe rapid shift to a more proactive advocacy approach across all our initiatives was triggered by one disruptive action a little more than a year ago – the buildup and onset of the trade war between the United States and China. From the outset, SEMI formed strong member coalitions to intensify our lobbying efforts, met frequently with policymakers, submitted written comments to government panels, and issued public communications, all aimed at amplifying our collective voice. SEMI has taken a principled approach to advocacy, publicly stating its positions based on its trade pillars of free and fair trade/open markets, supply chain growth, respect for IP and national security.That approach was on full display as Japan tightened controls on exports to the Republic of Korea, sending shockwaves through the microelectronics industry. To minimize the industry impact, we leveraged our global reach and the counsel of our International Board of Directors to engage with both governments early on and ensure that Japan took into account our members’ interests in developing and implementing the new rules. In general, SEMI opposes the use of tariffs and limiting market access as levers to correct trade imbalances and other structural issues. Instead, we support dialogue and negotiations that lead to multilateral agreements aligned with our members’ interests and global trade principles.This year in the U.S. alone, SEMI advocates have met with more than 70 policymakers in Washington, D.C., including members of Congress and representatives from the White House, federal agencies and the Trade Representative’s office. We have also spoken with representatives from European and Asian government delegations. Since the trade war erupted, we have met with more than 220 policymakers worldwide, giving SEMI a seat at the table – a louder voice for our members – as we are increasingly seen as the voice of the end-to-end electronics manufacturing and design supply chain. SEMI Global Advocacy has also broadened its focus beyond public policy to address other areas of strategic importance to the industry such as the talent shortage.Expanding Advocacy’s global influenceSEMI’s public policy efforts now reach well beyond Washington, D.C. to all seven major manufacturing centers worldwide where we have regional offices, with SEMI advocacy staff in every location. This has created a network multiplier effect that allows us to rally our collective strength around common member interests. It’s no coincidence that our member-driven advocacy initiatives and programs have improved in parallel with expanded global participation by our member companies on our various policy and advocacy committees.Our Trade Advisory Committee, for example, has grown from 16 to 60 active members in the past year alone. This year, we have also formed working groups with SEMI members around the world to address talent pipeline challenges. The upshot is that we are now much more focused in attacking regional issues. Thank you once again.Despite changes in the strategic approach of SEMI Global Advocacy, we remain squarely focused on critical issues affecting industry growth and our members’ interests. In a nutshell, we call these the four T's: Tax – We strive to encourage rates that are fair to all companies, leveling the playing field globally Technology – We seek government investment in technology and innovation (R D) Trade – We advocate for open markets, free and fair trade as we promote our 10 Principles for the Global Semiconductor Supply Chain in Modern Trade Agreements worldwide Talent – We support education investments and immigration policies that provide opportunities and build the talent pipeline In addition, SEMI has long been a leading voice in promoting Environment, Health and Safety regulations that enable industry growth and demonstrate environmental stewardship – and we continue to make investments at this critical juncture as new technologies are driving changes in the regulatory landscape.Maintaining laser focus on member priorities amid shifting geopoliticsThe only way for SEMI Global Advocacy to navigate the cauldron of geopolitical disruption is to remain laser-focused on our members’ top priorities including trade, tax, technology and talent. And we will stick to what SEMI has done best for almost 50 years – facilitate public-private collaborations and more investment on behalf of our members.In workforce development, SEMI is taking bold steps to develop a robust talent pipeline, as much a growth and innovation driver for SEMI members and the industry as any technology. Announced earlier this year, SEMI Works™, our landmark talent development initiative, is already gaining steam with U.S. government investment and our rapid progress in laying its foundation with a database of standardized competencies for technical jobs as well as a certification and credentialing process for curriculum, education and training programs.The future for SEMI members and the industry is brimming with possibility. The strides SEMI Global Advocacy has made over the past year have only been possible through your support and involvement. As we broaden our scope beyond policy, we recognize that more progress needs to be made. We look forward to your continued participation as, together, we help our industry fulfill its great potential.Mike Russo is Vice President of Global Industry Advocacy at SEMI.

Tensions between the United States and China have reached fever pitch. Ongoing trade negotiations between the U.S. and China broke down earlier this month over reported backpedaling by China on key concessions in a proposed Trump administration deal. Over the past year, the U.S. has raised tariffs on more than $250 billion worth of Chinese goods to 25 percent, and last week the administration proposed tariff hikes on an additional $300 billion in imports – moves that have drawn retaliatory tariffs from China, many squarely hitting the semiconductor industry. Based on SEMI member feedback, the tariff increases will cost the semiconductor industry more than $750 million annually.At the same time, the Trump Administration is taking other steps to ratchet up pressure on China. Last week, seven months after placing Fujian Jinhua on the Entity List, which effectively blocks the sale of and export of goods to China, the U.S. Department of Commerce added Huawei (and nearly 70 affiliates) to the list. While the U.S. is taking this action for security reasons, it is also seen as a move to create leverage at the trade table. The U.S. is also intensifying efforts to reform the export control regime, focusing first on enhancing controls on emerging technologies and then on foundational technologies. The rising pressure has prompted China to contemplate and launch a counteroffensive that goes well beyond tariffs and export controls. The reprisals include China’s promotion of heightened Chinese nationalism by domestic consumers, a tactical slowdown of administrative processes required to conduct business in China, and the imposition of direct or indirect limits to market access. China is also using U.S. actions to justify larger state investments in its domestic industry and is ramping up efforts to give other regions greater access to its markets as it works to strengthen those relations ahead of next month’s G-20 summit in Osaka, Japan. The U.S. is also maneuvering to bolster its negotiating hand through its own agreements with Japan and the European Union.Unintended consequences of Trump administration actionsThe Trump administration’s moves to rectify the trade imbalance with China are also well-intentioned in seeking to protect the IP of U.S. technology companies and ensure continued U.S. leadership in technology development and innovation. However, its tactics can encourage long-term, perverse shifts in the globally integrated electronics manufacturing supply chain that risk upending market-driven investments in the semiconductor industry and weakening natural market forces that nourish competition among companies based on service, quality and product offerings.It is critical for SEMI, in working with government officials, to shed light on the potentially deep, unintended damage its trade actions can wreak on global supply chains and markets. We will continue to promote global standards governing trade, IP and market access through our Global Trade Principles and focus on sustaining a global order that assures the electronics manufacturing supply chain remains cohesive and vibrant.SEMI continues efforts to influence trade policyWe continue to meet with government policymakers around the world to educate them on near- and long-term impacts and risks of their evolving trade practices, conducting approximately 220 meetings with government officials globally in the past year. We also facilitate individual and group member meetings to give SEMI members direct contact to key government decision-makers. For example, on May 22nd during the SEMI Spring Washington Forum, or “fly-in,” more than 30 semiconductor industry executives from across the supply chain met with administration officials and Congressional offices to discuss issues including trade, export controls and immigration reform and impacts on their businesses. The executives represented a cross-section of small, medium, large and global companies based in the U.S. or providing support for U.S. organizations. Their aim: influence policy development. SEMI is in a unique position as a representative of the end-to-end, global electronics manufacturing supply chain and is a valuable “one-stop-shop” that represents members on policy while providing opportunities to collaborate in one of our Technology Communities. SEMI members can also leverage our strategic partnerships, our market research or leadership in industry standards. With this breadth and depth of member engagement and industry expertise, SEMI leads in providing industry insights to governments at this critical time. There is no doubt that the current situation is complicated and it is impossible to predict when or how the trade issues will be settled. As the U.S. and China work to settle the trade dispute, SEMI will continue to lead efforts to ensure that the voices of SEMI members and the electronics industry supply chain are heard.Mike Russo is vice president of Global Industry Advocacy at SEMI.

For public policy lovers, civic-minded, engaged U.S. citizens, and people around the world interested in the U.S. President’s positions and priorities, the annual State of the Union address (SOTU) is “must-see TV.” This year, the anticipation and expectations were different than with past presidents. President Trump is the first U.S. president who has used social media to the extreme that he has. President Trump’s prolific Twitter feed has had an interesting impact on the SOTU. U.S. citizens and people from around the world already know President Trump’s positions on issues, his policy priorities and what gets him excited. There is an ongoing, direct line to the President’s thoughts throughout each and every day. In the past we looked to the SOTU for insights into what the sitting president is really thinking and his future policy priorities. Now, there isn’t much we don’t already know.One looming question this year was whether President Trump would reach out in a conciliatory manner to help bridge the political divide and lay the groundwork to enable some public policy wins and avoid another government shutdown. While there were moments of conciliation, the President made it clear he would not move on areas that are most contentious with the other side of the aisle. For example, the President unequivocally reiterated his intent to build the wall. While the message plays well to his base, it is, in effect, a frontal assault and challenge to Democrats. It’s hard to image that his staunch stance will help move the two parties to work together on substantive policy issues. It may also mean that the wall issue will occupy lawmakers time for the foreseeable future, sidelining debate on other important issues.The best hope is that a bipartisan bill finds its way to the President’s desk that he can sign and use to “declare victory.” However, many political observers believe the likelihood of the President declaring a national security emergency is rising as a maneuver to ensure funding for the wall and avoid a shutdown. While such a declaration would most likely face a court challenge, the President could claim that his decision was a move of last resort and leverage the moment to position Democrats as obstructionists to his base. The scenario does not bode well for the bipartisan support necessary to address other issues.What does this mean for our industry? Were there any points raised in the SOTU that would signal a change in what we are facing regarding trade, tariffs, export controls and immigration? Were any new issues or ideas raised that could help lift the global economy? In short, no. On one hand, the President cited his good relationship with the president of China, but on the other doubled down on his attacks on China, seeming to stand firm to bolster his position at the table as the U.S. and China trade talks continue.What do these dynamics mean for SEMI Global Advocacy? In 2018 we were heavily engaged in efforts to prevent regulations that would inhibit our members' ability to develop and deploy technologies and maintain global market access. We advanced our global advocacy model, leveraging our regional presence around the world. Many of the potential issues we faced emanated from the U.S., including those focused on controlling technology development, limiting trade and enhancing export controls. We also intensified our efforts to address industry talent pipeline issues.In 2019, our public policy focus will be to continue to push back on tariffs, engage members to inform the rule-making process for export controls and to attempt to influence the immigration debate as it pertains to access to talent. In addition, while the U.S. R D tax credit was made permanent through the tax cut in 2017, some of the provisions may have unintended consequences and will need to be modified. How the law is enacted will affect how businesses can deduct qualified research and development and other expenses from their taxable income, so we anticipate activity on the tax front as well.It will also be a big year for SEMI on the workforce development front. SEMI will continue to grow its existing High Tech U (HTU), university and mentor programs. In addition, SEMI will be positioning itself as the global leader in addressing issues related to the talent pipeline by approaching the problem with a full-spectrum, holistic approach that is intended to better address more immediate needs in attracting, training and retaining qualified talent. We’ll also focus on improving the industry image and exciting students at a younger age by providing experiential learning activities throughout a defined educational pathway. Stay tuned on this front as the full program unfolds.In general, we will continue to build our relationships and stature as a leading voice for our members and the end-to-end semiconductor supply chain in the areas of talent, trade, tax and technology (SEMI’s “4 Ts”) and to ensure free and fair trade, access to markets, supply chain growth, IP protections and enhanced efforts to improve cybersecurity. Mike Russo is VP of Global Industry Advocacy at SEMI.

Last year the industry posted another remarkable double-digit revenue growth year. IC shipments eclipsed one trillion units for the first time and continued to enable an ever-expanding array of silicon intensive-applications.2018 was also a pivotal year of transformation at SEMI. Setting our sights firmly on building more value for SEMI members, we doubled down on priorities I established this time last year. We advocated intensively on global trade policies, industry talent needs, and critical environment, health and safety (EHS) concerns. To underpin our efforts around talent, we took the bold step to reinvigorate the industry’s identity with a dynamic image campaign. Above all, we targeted critical industry-wide issues to help us realize the ambition of becoming a trillion-dollar industry in the next decade. Workforce DevelopmentRedefining our approach to talent development in 2018 was and remains a top priority. A diverse, highly skilled workforce is crucial to the industry’s ability to innovate. Last year we ramped up a number of SEMI High Tech U (HTU) programs to inspire young people and attract them to careers in high-tech manufacturing. To date, more than 130,000 students have been touched by HTU – through student or teacher programs.Over the past year, we designed a new university outreach program and established partnerships with 100 institutions. We established Workforce Pavilions at SEMICON events in Southeast Asia, the U.S., Taiwan, Europe and Japan for students to explore career opportunities and meet with recruiters. We thrilled at seeing sponsors hire young talent at SEMI events. This year, all SEMICONs worldwide will feature Workforce Pavilions.SEMI also formalized its commitment to Diversity and Inclusion (D I) with the establishment of a D I council to shape new programs including the recently launched Spotlight on SEMI Women. To localize and fully optimize our D I programs, we established regional workforce councils in every region we serve. We unveiled the SEMI Mentoring Program to support students and young professionals on this journey by facilitating one-on-one mentoring relationships with industry professionals. Hundreds of mentees have enrolled. But we still need more mentors. I urge you to join the program. During the year, SEMI also expanded its workforce staff and developed a comprehensive workforce strategy with programs that engage students as early as elementary school and inspires them through high school and college. The program provides pathways to professional careers, building a pipeline to fill the short-term and long-term talent needs of the industry. Industry Image CampaignAs we developed the comprehensive workforce development program, we knew we had to refresh the industry’s image and appeal to the next generation through contemporary media and communications channels. So we recently launched a bold, innovative campaign to raise industry awareness and attract students and recent graduates to careers in semiconductor manufacturing.Our You’re Welcome campaign is a novel, creative approach that blends entertainment, media and storytelling to excite students about the industry. The campaign went viral immediately and within weeks had more than 5.5 million social media impressions and 2.3 million video views.Trade Policy AdvocacyRising trade tensions between the U.S. and China catapulted global trade policy to the forefront of industry concerns in 2018. Since the tariffs have taken force, semiconductor companies have faced higher costs, greater uncertainty, and difficulty selling products abroad. The tariffs have forced many SEMI member companies to pause or rethink their investment strategies.SEMI quickly engaged U.S. policymakers and provided resources for SEMI members. We formed a member trade task force, staged trade compliance seminars in China, and convened meetings with over 110 U.S. congressional, agency and administration officials, and provided testimony on the importance of the free trade to the industry.SEMI continues to educate policymakers about the critical importance of free and fair trade, open markets, and respect and enforcement of IP for all players in the global electronics manufacturing supply chain. As part of this initiative, we distributed “10 Principles for the Global Semiconductor Supply Chain in Modern Trade Agreements” and encouraged their adoption in various trade negotiations. These principles outline the primary considerations for balanced trade rules that benefit SEMI members around the world, strengthen innovation and perpetuate the societal benefits of affordable microelectronics.Environment, Health and SafetyEnvironmental regulations are proliferating globally even as advanced semiconductor manufacturing technology relies increasingly on a host of new materials. With dozens of new fabs and fab line upgrades, our industry must align on best practices, sensibly respond to materials restrictions, and renew efforts toward sustainable manufacturing.That’s why the revitalization of SEMI EHS efforts became another priority in 2018. Two months ago, we hosted the inaugural EHS Summit at SEMI Headquarters. Fully, 70 EHS professionals and company executives met to form the basis for the future SEMI EHS program.The Year AheadDespite a softening in the market, compounded by Apple’s first-ever announcement of a revenue decline in 16 years, a geopolitical whirlwind on trade and an extended shutdown of much of the U.S. government, the future is bright.At SEMI’s annual Industry Strategy Symposium (ISS 2019) in Half Moon Bay, Calif. in early January, the sense of optimism was palpable. In her keynote address, Dr. Ann Kelleher, Sr. VP and General Manager, Technology and Manufacturing Group, at Intel, observed that data is powering the fourth industry revolution and the expansion of compute. With customers expecting continual improvements in applications, Kelleher highlighted the tremendous opportunity for the chip industry to meet these expectations.At ISS 2019, we announced a Memorandum of Understand between SEMI and imec. The MOU will enable us to accelerate our members’ engagement in SEMI’s Smart vertical market platforms, in particular Smart MedTech and Smart Transportation. Our partnership with imec will also allow us to boost SEMI Standards activities in non-CMOS technologies, deepen technology roadmap efforts and augment our SEMI Think Tank initiative in thought leadership at a global level.Over the course of this coming year, will we begin our global rollout of key building blocks of our comprehensive workforce development program to engage schoolchildren as young as 10 and learners all the way to veterans who return to the workforce. We are now able, with the invaluable help of our Workforce Development Council and the passionate engagement of many SEMI member companies, to offer a solution to the talent crisis in our industry.We will continue to be the leading voice for our members and the end-to-end semiconductor supply chain across Talent, Trade, Tax and Technology as we work to ensure free, fair trade that protects IP while preserving vital access to markets to grow the supply chain. Vertical Market PlatformsOur vertical market platforms are an important part of this growth. For example, in Smart MedTech, SEMI looks forward to working with the Nano-Bio Materials Consortium to advance human monitoring technology for telemedicine and digital health after winning $7 million to fund the renewed program. In Smart Transportation, we will leverage the Global Automotive Advisory Council (GAAC) we formed last year to represent the full automotive supply chain and the Smart Transportation and Smart Automotive forums featured at all our SEMICON events to enable the industry to identify and seize opportunities in autonomous driving. At ISS 2019, Sujeet Chand of Rockwell Automation noted that “digitization will grow faster in the next 10 years than it did in the past 50,” a trend calling for semiconductor fab architectures that transform data into business value. We will continue to bring the industry together at our Smart Manufacturing venues to help uncover ways to deploy deep learning, edge computing and other Smart technologies to deliver this value and meet the challenges of automation as artificial intelligence’s (AI) sprawling influence reshapes industries including manufacturing.I am filled with optimism and thrilled about the opportunities I see on the horizon for our members as we build on our 2018 accomplishments to enable your prosperity in 2019 and beyond. My heartfelt thanks to all of you for your participation in our programs and events.I look forward to another successful year as we connect, collaborate and innovate together!Ajit Manocha is president and CEO of SEMI.

With (most of) the election results in from the U.S. midterms, the expected Democratic takeover of the House and the Republican’s maintaining control of the Senate is now a reality. The day of the election, DC insiders expected that the House would go to the Democrats by a margin of +/- 20, with the Republicans gaining 2-3 seats in the Senate. Not a bad prediction, which is a far cry from what the same insiders called in advance of the 2016 Presidential election.What does that mean for our members and the tech sector in general? Will there be an ease of trade tensions or less of a chance of tighter export controls? Some believe that with the midterm elections over, President Trump will have some room to take a less aggressive stance against China, setting up a “win” that he can carry into 2020. With the recent more aggressive stance by North Korea against the U.S. regarding its nuclear program, China may well have some leverage at the trade table … and the U.S. may want to make a deal that provides a path for a “win” on both fronts. Indeed, there are the makings of a potential win-win leading into the G20 meeting in Argentina when President Xi Jinping and President Trump are scheduled to meet on Dec. 1.One can see a scenario where there is a meeting of the minds and some degree of lessening tariffs; that does not mean that the effort to enhance export controls will go away. The need for tighter restrictions on export controls is driven to a great degree by the U.S. Department of Defense (DoD) and is a follow on from the previous FIRRMA legislation and attempts to curb the loss of U.S. technology critical to global competitiveness and national security. This issue will not go away anytime soon, and cases like the recent one involving Jinhua only add fuel to the fire. In addition, given how these cases can be leveraged at the negotiating table, they will continue to surface.SEMI’s approach has been to educate governments, lawmakers and administration officials on the strategic importance of the globally connected and highly complex semiconductor supply chain, and how some of the approaches will not achieve the attended goals. This approach helps to ensure that when and if it comes time to make decisions based on merit, the principals are informed. It also helps SEMI and its members develop and maintain important relationships and positions SEMI as an industry leader and spokesperson, making it a more effective advocate. As an example, on Nov 8th SEMI released its Global Trade Principles with the intention of providing a framework to all governments to guide various trade talks. It also helps to inform member companies and others from the broader tech sector of our industry position(s) so we are able to speak with one voice. These principles are aligned with our fundamental advocacy pillars of promoting free trade and market access, respect for IP, cybersecurity and national security.Will the fact that power is now split between the two chambers of Congress help or hurt? Will the House focus on investigations limit the ability to move productive legislation? Besides taking time, it may well put them at increasingly worse odds with the Senate and the President (if that is possible), creating deadlock. Some argue that if nothing moves, no harm can be done. Some also say that it may drive the President to take independent and more aggressive actions in order to demonstrate (his) effectiveness to his base. There is another view: that with the Democrats, the President may be able to lead in the advancement of legislation that will show he can get things done when others couldn’t in areas that benefit the greater good…some of which may impact our industry…such as investments in education and infrastructure development. This would be a way that he could pull in some of the votes from the middle that he has lost in his first two years in office. They say “politics makes for strange bedfellows”; one never knows what might happen in this case.Regardless of what happens, some things will not change: the global nature of our business and the needs of our members to have access to markets…and to be able to safely and efficiently leverage their technologies in the way they see fit in order to grow their business. SEMI will continue to advance the interests in what is an extremely challenging and dynamic global policy environment today. As ruling parties and representatives change around the globe, we will continue to build new relationships and educate lawmakers so they are able to make informed decisions that benefit our members. Mike Russo is VP of Public Policy and Talent Advocacy at SEMI.

Last week, SEMI joined a coalition of business groups in calling for Ambassador Robert Lighthizer, U.S. Trade Representative, to enact an exclusion process for the most recent tranche of tariffs on $200 billion in goods imported from China. While an exclusion process was provided for in the previous tariff lists, which cover about $50 billion in goods, the administration has said that no similar process will be provided on the most recent tariffs on $200 billion (List 3), which took effect Monday. SEMI members will face millions of dollars in additional duties as a result of these tariffs. This action will also curb growth, stifle innovation, and introduce significant uncertainty in the semiconductor industry. Americans for Free Trade is a diverse coalition, which includes hundreds of companies across the United States, to illustrate the impacts of tariffs on American businesses, consumers and manufacturers. SEMI is a member of this coalition. The full text of the letter can be found here. Any SEMI members with questions should contact Jay Chittooran, Public Policy Manager at SEMI, at [email protected].