Belgium is not only famous for its chocolate and beer, but also for its semiconductors.

IMEC is a world leader in semiconductor research, and the only way it can thrive is by working with democratic allies while cutting ties with China.

On the outskirts of the medieval city of Leuven, not far from the 15th-century Gothic town hall and the towering 15th-century Gothic Church of St. Peter, stands a gleaming modern tower. This is where you'll find the Interuniversity Microelectronics Center (IMEC). This is not your typical high-tech unicorn: It's a non-profit research center spun out of the KU Leuven, one of the world's oldest universities.

This unique institution provides cutting-edge technology for the world's most advanced semiconductor manufacturing. As governments around the world race to bolster their semiconductor industries, they covet the knowledge produced here and fear it could fall into the wrong hands. In response, IMEX leadership has scaled back ties with China and strengthened ties with the United States, Taiwan, Japan and South Korea.

Separation is not possible, CEO Luc Van den Hove told a small group of journalists during the visit. The global semiconductor industry is fueled by the strengths of different regions. The European Union leads in the imaging equipment needed to make chips. The United States leads in design. Taiwan leads in advanced manufacturing. Japan leads in wafer manufacturing. China has an advantage in the ability to refine many of the necessary raw materials, such as gallium and germanium. Modern chip production involves more than 1,000 steps, 300 materials, and up to 16,000 suppliers, crossing borders 70 times. This complex supply chain, with more than 50 bottlenecks, is vulnerable to disruptions.

In this global chip orchestra, imec occupies a unique position as the orchestrator. It doesn't manufacture chips, it tests and validates technologies. In its modern headquarters, researchers work with cutting-edge tools and prototypes. Employees take an air shower before entering the cleanroom. Perforations in the surface of the room prevent dust from accumulating, and air pressure and a state-of-the-art filtering system keep the building clean. The cleanroom operates 24 hours a day, 365 days a year, and is home to hundreds of machines made by different companies.

As an orchestrator, imec brings together the key players in the chip industry: tool suppliers, material providers and users. Startups have difficulty accessing Asian fabs such as TSMC. Taiwanese semiconductor manufacturers cannot tailor design rules to their requirements. They don't have the bandwidth to serve hundreds of smaller companies.

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That's where imec comes in: imec aggregates requests from dozens of startups, allowing TSMC to work with many startups through one sales channel and a single support funnel. Successful ventures often become TSMC customers directly. One of this article's co-authors benefited from imec as chief operating officer of a tech startup in Cambridge UK. Imec gave his company access to TSMC's design rules and capabilities to design the proof-of-concept imaging test chips it needed to demonstrate to investors and potential acquirers.

In CEO Van den Hoves' words, imec short-circuits the traditional value chain. Instead of an expensive sequential innovation model, where design processes are scattered in different places, imec brings them all together in a networked innovation model. Major industry players such as Intel and Nvidia believe imec is essential to their innovation, so they provide 75% of the funding. Intel CEO Pat Gelsinger says Europe has two jewels: ASML, which does cutting-edge lithography, and imec.

Imec has a sibling relationship with ASML, the Dutch lithography leader. Together, they form what The Economist magazine describes as the “Silicon Valley of Europe”. Imec and ASML were both founded in 1984, their common language is Dutch, and their headquarters are just over an hour's drive apart. The two companies began working together in 1986, with imec bringing many of the innovations that enabled ASML to manufacture the world's most advanced lithography equipment, essential for shrinking the dimensions of semiconductors. Over the past 40 years, imec's workforce has grown from 70 to more than 5,500 people, of which 70-80% are researchers. More than 100 nationalities work at the Leuven headquarters. Imec employs 800 PhD students from universities outside KUL.

Relations with China are delicate. In recent years, Belgian authorities expelled the institute's Chinese researchers on suspicion of espionage. Ten years ago, China was a growth market for imec. Now, imec only works with Chinese organizations on minor projects and is winding them down very quickly, van den Hove said.

In the 2021 EU Chip Act, the European Union aimed to ensure a secure supply of chips and achieve a degree of self-sufficiency. Imec recently secured $2.5 billion in funding for the Chip Act. While the EU recognizes Imec's position as a global leader in semiconductor research and development, van den Hove is concerned that the move toward European self-sufficiency will undermine efficiency in the semiconductor value chain. Instead, he says, the EU should prioritize closer cooperation with geopolitical allies.

Van den Hove is a life member of imec and has served on its Executive Board since 2007. He holds a PhD in Electrical Engineering from the KU Leuven and is a recognized expert in nanoelectronics. Under his leadership, imec has expanded its reach into areas such as biomedical research, quantum computing and artificial intelligence.

As AI demands an increase in the size and number of data centers, imec is developing more power-efficient technology that will transform imec's focus on biotechnology. Van den Hove explains the explosion of bioconvergence that is generating vast amounts of data that only AI can analyze.

Today, only semiconductor geeks may know of imec, but tomorrow pharmaceutical companies and doctors may also see it as crucial in pushing the boundaries of knowledge and a key player in helping the West get ahead of China in the global technology race.

Christopher Cytera is a Non-Resident Senior Fellow in the Digital Innovation Initiative at the Centre for European Policy Analysis and a technology business executive with over 30 years of experience in semiconductors, electronics, communications, video and imaging. His previous start-up was partnered with imec.

Sara Oversteyns, an intern with the CEPA Digital Innovation Initiative, visited imec in Leuven and participated in a conversation with CEO Luc Van den Hove.

Bandwidth is CEPA's online journal dedicated to promoting transatlantic cooperation on technology policy. All opinions are those of the authors and do not necessarily represent the position or views of the institutions they represent or of the Centre for European Policy Analysis.

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