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G7 leaders unveil semiconductors supply chain coordination initiative

Leaders from the Group of Seven are set to announce plans for a group that will help coordinate the supply chain for semiconductors that are critical to the global economy.

The point-of-contact group will also help steer subsea cable connectivity, ensuring security and resilience for the lines that connect countries to the Internet and each other, according to a draft statement seen by Bloomberg. G-7 leaders are meeting this week in southern Italy.

The semiconductor group will be the latest in a string of initiatives meant to secure global access to chips — used in everything from cars to smartphones and PCs to home appliances — after supply chain disruptions and misjudged demand lead to shortages during the Covid-19 pandemic.

Demand will only grow as the boom in artificial intelligence programs gains momentum, while access to the technology has become the centre of a trade war with China. Europe and the US are working to secure domestic production while Beijing tries to advance its own capabilities in spite of trade restrictions limiting its access to some technology.

The infrastructure around subsea cables is also in focus after a number of outages showcased how difficult these lines are to protect and maintain. Repairs to cables damaged in the Red Sea in February were delayed for months over disputes about who controls access to infrastructure in Yemeni waters.

Even without territorial disputes, repairs can take months because of a lack of repair ships and the difficulty in reaching the lines. Bloomberg

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