The envisioned Chips Act by the European Union can create new business opportunities for South Korean materials, parts and equipment makers in the semiconductor industry, though it is expected to intensify global competition, Seoul's industry ministry said Wednesday.

On Tuesday, EU member nations agreed to pass the Chips Act, a US$47.2 billion plan that provides aid for corporate investment in chipmaking facilities to boost Europe's production of semiconductors to 20 percent out of the world's total from the current 9 percent.

The bill awaits final approval by the European Parliament and member nations.

"The act does not appear to include explicit discriminatory clauses against foreign firms. South Korean chipmakers' production facilities are not located in EU nations so it is unlikely to have direct impacts on us," the industry ministry said in a release.

The possible strengthening of European nations' semiconductor manufacturing capabilities will cause heated competition in the industry, but their push to expand chips production facilities can make more export opportunities for South Korean makers of materials, components and equipment, it added.

"We will closely monitor the developments leading to the final approval and have close communications with domestic chipmakers to analyze its impact on our industry and to seek necessary responses," the ministry said, vowing to have consultations with the EU over the issue.

Source: Yonhap News Agency