EU approves Italian aid for $5.4 bln STMicro energy chip plant

CATANIA, Italy May 31 (Reuters) - The European Commission on Friday approved Italian state aid for chipmaker STMicroelectronics (STMPA.PA), to build a 5 billion euro ($5.4 billion) plant in Catania, Sicily, to make specialist microchips that boost energy efficiency in electric cars.

Chipmakers across the globe are investing billions of dollars in new plants, encouraged by rising use of semiconductors in everyday devices as well as U.S. and EU subsidies aimed at keeping the West ahead of China in the race for cutting-edge technology.

The aid approved by the EU executive will be a direct grant of about 2 billion euros to support STMicro’s production of chips made from silicon carbide, which is more energy-efficient than standard silicon.