The Centro Nacional de Tecnologia Eletrônica Avançada (Ceitec), Brazil’s federal state-owned microchip manufacturer, has resumed operations after undergoing a process of extinction, which was reversed by a presidential decree. The restart of activities was marked by a ceremony in Porto Alegre, attended by the Minister of Science, Technology, and Innovation, Luciana Santos.
The state government is also including Ceitec in its strategic plans outlined in the Semicondutores RS program, executed by the Secretaria de Inovação, Ciência e Tecnologia (SICT), with over R$ 70 million in investments planned for the sector until 2026.
The current resumption aims to reduce the risks associated with infrastructure, machinery, and equipment losses, enabling the company to re-enter the market, as stated by SICT. The importance of having a well-established chain in the semiconductor sector is emphasized by Simone Stülp, the Secretary of Innovation, Science, and Technology.
“In today’s world, our lives are entirely connected, whether in issues related to complex industrial plants or in our daily lives, with the various electronics we use to be present in the dynamics of the 21st century,”– Stülp
Brazil is increasingly becoming a significant player in the global semiconductor market, caught in the crossfire of the competition between the United States and China. According to reports, U.S. representatives have approached the Brazilian government to negotiate new investments and technology transfers to national factories.
This matter was also discussed during President Luiz Inácio Lula da Silva’s visit to the White House in February. The U.S. Secretary of Commerce, Gina Raimondo, mentioned the creation of the new Chip Law to maintain American leadership in the semiconductor market.
Furthermore, U.S. Trade Representative Katherine Tai is visiting Brazil with a delegation of entrepreneurs interested in investing in the country, including the chip sector. If the investment and agreements materialize, Brazil may align itself with the U.S. in the trade dispute with China, as the Biden administration’s new Chip Law imposes restrictions on manufacturers receiving federal incentives.
One crucial restriction involves a complete ban on exporting chips to China for up to 10 years. Additionally, Brazil would need to adhere to the “foreign direct product rule,” prohibiting any industry using American technology from exporting chips to China without U.S. authorization.
Nevertheless, technology transfer is expected to enable the 11 major semiconductor companies in the national market to engage in less advanced semiconductor frontends and begin producing 14-nanometer chips within the next decade.
Another aspect of the agreement that could benefit Brazil involves the U.S.’s new nearshoring strategy, as the country aims to shift chip factories from Asian countries to Western allies. Therefore, Brazil, Mexico, and Costa Rica might receive part of this production currently based in China.
The Brazilian government is currently evaluating the U.S. proposal while also considering what China has to offer, aiming to keep both superpowers in competition.
In a bid to strengthen diplomatic ties, Brazil is looking to Vietnam, with both countries expressing interest in extending their agreement in the field of technology. Luciana Santos, the Minister of Science, Technology, and Innovation, conducted an official trip to Vietnam to discuss semiconductor-related negotiations with Prime Minister Pham Minh Chin.
Negotiations for an agreement in the semiconductor sector were initiated, highlighting its relevance in the technology market, considering that only a few countries globally possess expertise in this area.
“The Brazilian government has implemented a set of actions to dominate the scientific, technological, and productive knowledge that few countries in the world possess in such a strategic sector as semiconductors,”– Luciana Santos
During her visit, Santos delivered a letter from President Luiz Inácio Lula da Silva announcing a trip to Hanoi, Vietnam’s capital, in 2024, coinciding with the 35th anniversary of diplomatic relations between the two countries.
Prime Minister Pham Minh Chin is seeking support for the signing of a free trade agreement between Vietnam and Mercosur. He expressed optimism that President Lula’s visit to Vietnam would elevate bilateral cooperation to a new level, anticipating the country’s goal of training 100,000 high-tech engineers by 2030.
These discussions come shortly after the decision to shelve the liquidation process of Ceitec, the only chip manufacturer in Latin America, which was in the process of privatization under Jair Bolsonaro’s administration.
In addition to semiconductor-related negotiations, both countries aim to deepen their cooperation in other technological spheres, such as quantum computing and artificial intelligence, for which a regulatory bill is under consideration.