The relationship between critical raw materials and critical technologies is symbiotic. Critical technologies require specific raw materials to operate efficiently, while the demand for these raw materials is driven by the development and adoption of critical technologies.
Critical technologies encompass a wide range of fields, such as advanced manufacturing, clean energy, telecommunications, space exploration, artificial intelligence, and defence systems.
In the EU, technologies needed for space applications are recognised as “strategic technologies” under the Proposal for a Regulation concerning critical raw materials, which expressly mentions rocket launchers and satellites in this regard. As seen in relation to Critical Raw Materials, States shall, under this Proposal, identify the large companies that manufacture strategic technologies using strategic raw materials on their territory. These companies will be subject to a set of obligations, including the requirement to perform an audit of their supply chain.
The EU has also developed a specific approach to key enabling technologies deemed strategically important for the Union. In this regard, we highlight the set of initiatives put forward to ensure Europe’s autonomy in chips / semiconductors, including the Communication A Chips Act for Europe and the Proposal for the Chips Act, aimed at addressing semiconductor shortages and ensuring autonomy and security of supply. With this purpose in mind, in May 2023, the European Commission introduced the Semiconductor Alert System, a pilot system designed to monitor the semiconductor supply chain and which enables stakeholders to report any significant disruptions occurring along this chain. It follows the Commission Recommendation on a common Union toolbox to address semiconductor shortages and an EU mechanism for monitoring the semiconductor ecosystem.
In addition, a Chips Joint Undertaking is to be approved in the EU. This undertaking will be responsible for implementing a set of actions under the Chips for Europe Initiative, which aims to strengthen the EU’s R&I capacity by promoting lab-to-fab and supporting SMEs and start-ups in scaling their businesses. The undertaking replaces the Key Digital Technologies Joint Undertaking set up in 2021, which notably aimed at reinforcing the Union’s strategic autonomy in electronic components and systems, while also establishing innovation leadership in emerging components and systems technologies, including in activities related to lower TRLs (Technology Readiness Levels). An Industrial Alliance on Processors and Semiconductor Technologies was also set up with a view to identifying existing gaps and the technology developments necessary for competitiveness in the EU.
The role of critical technologies, notably chips, in the space sector is central. Indeed, the history of semiconductors traces back to the 1950s, when they were first used in computer systems for NASA spacecraft and missiles.
In the EU, critical technologies in space are expressly addressed in the Action Plan on synergies between civil, defence and space industries. This document mentions the set-up of the EU Observatory of Critical Technologies, aimed at providing regular monitoring and analysis of critical technologies for the civilian, defence and space sectors, their potential applications, value chains, needed research and testing infrastructure, desired level of EU control over them, and existing gaps and dependencies. Based on this analysis, roadmaps, funding instruments and stakeholders’ cooperation initiatives will be developed and addressed.
With relation to funding, increased investment in key space technologies as of 2023 was put forward under Horizon Europe. Notably, the EU has increased its budget from Horizon’s Cluster 4 by 24 million EUR to 424 million EUR. The Horizon Europe Work Programme 2023-2024 for Cluster 4 focuses on addressing challenges related to digitalization, industry, and space, and aims to drive the digitisation and transformation of industries while enhancing the EU's sovereignty in key enabling technologies.
In addition, actions to address the vulnerability of European supply chains and ensure non-dependence on critical space technologies have been jointly developed by the European Commission, ESA and EDA Task Force, with the list of urgent actions for implementation in 2021-2023 having been issued. The next cycle of actions is currently being developed, with expected completion by early 2024.
Other countries are also developing their approach to chips / strategic technologies.
For instance, in May 2023, the UK published its National Semiconductor Strategy, which expressly acknowledges that technological progress at the semiconductor level is essential to achieving the country’s national space strategy, also taking into consideration the need for specialist semiconductors that can operate in extreme environments such as space. The UK had already addressed critical technologies, including semiconductors, among others (such as AI, quantum and engineering biology), in its Science and Technology Framework, which highlights the UK’s investment and financing in this scope, as well as its goal of developing a regulatory framework for critical technologies.
In the US, the Chips and Science Act provides around 280 billion USD in funding to bolster US semiconductor capacity by supporting research and manufacturing. It created the largest publicly funded R&D programme in US history. A Strategy for critical and emerging technologies had already been issued, with the National Standards Strategy for Critical and Emerging Technology having been published in May 2023. A list update of critical and emerging technologies – covering space technologies and systems – was published in 2022.
Canada has also announced investment in the Canadian semiconductor industry, with the Canada Semiconductor Council having published, in 2021, its industry report Roadmap to 2050: Canada’s Semiconductor Action Plan.
In Africa, the importance of investing in the semiconductor industry has already been highlighted, with the development of indigenous capabilities to play a relevant role in the continent’s growing ambitions in space, as seen in the African Space Policy and Strategy, as well as the set-up of the African Space Agency.
Investment in critical technologies largely benefits the space sector, whilst the sector itself can make use of the approaches, financing and initiatives launched by States to assist in their digital transformation and innovation. A critical technology race can be said to be in progress, spurred by the digital and green transition and geopolitical challenges. In March 2023, the Australian Strategic Policy Institute introduced a Critical Technology Tracker to check, at any given moment, who is leading the race when it comes to scientific and technological capability. This is a race the space sector can take advantage of. Not only in relation to chips, as seen above, but also other critical technologies, such as AI, robotics, quantum, bio and nanotechnology, among others. But this is a story for another time.