23.1 After reading the text below, answer the question: why are silicon chips so important in our world?
THE GLOBAL CHIP SHORTAGE
Silicon chips, which are the basis for integrated electronic circuits, have become more and more important in our world, as not only producers of small electronic devices, but also industries like automotive manufacturing, industrial machinery,
and medical devices are increasingly dependent on chips. For this reason, the global chip shortage that took place between 2020 and 2023 had a great impact on industrial production all over the world. This shortage was the result of a series of interconnected events such as:
• Covid-19 pandemic: the Covid pandemic caused a huge growth in the demand of electronic devices due to the rapid increase of remote work and learning. At the same time, lockdowns and factory shutdowns caused production to slow down, while supplies were progressively reduced and sold out;
• problems in manufacturing: in 2021, long periods of drought affected Taiwan, where a great number of chip manufacturing industries lie, and made it difficult for the factories to get the pure water needed for chip fabrication; in the same year, a fire in a major chip factory in Japan further increased the shortage in the chip supplies;
• geopolitical factors: trade tensions, such as those between the USA and China, led to a fall in the export of goods. As a consequence, chips were accumulated in warehouses instead of being sold, thus reducing the Western supplies. Moreover, the war which broke out after the Russian invasion of Ukraine in 2022, led to an exponential increase in the cost of gas, which is very important for industrial production, and to a reduction of the supplies, slowing down the chip production and increasing its cost.
■ How is the problem being solved?
The 2020-2023 chip shortage made the importance of the chip industry more evident than it was before. Building new semiconductor factories, spreading them across different regions, expanding existing ones, and developing new technologies and materials to reduce the dependence on traditional silicon-based chips are some of the possible actions that can be undertaken to avoid chip shortages in the future.
Adapted from: https://en.wikipedia.org/wiki/2020%E2%80%932023_global_chip_shortage
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Soluzione suggerita: Because not only producers of small electronic devices, but also industries like automotive manufacturing, industrial machinery, and medical devices are increasingly dependent on them.
23.2 After reading the text in the previous exercise, answer the question: why did the chip demand increase during the Covid-19 pandemic?
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Soluzione suggerita: Because there was a greater demand of electronic devices due to the increase of remote work and learning.
23.3 After reading the text in Exercise 23.1, answer the question: why, on the other hand, was it difficult to produce chips during the pandemic?
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Soluzione suggerita: Because of lockdowns and factory shutdowns.
23.4 After reading the text in Exercise 23.1, answer the question: what were the major problems which affected some of the most important chip factories in the world?
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Soluzione suggerita: Drought affected factories in Taiwan, while a fire burst out in a big factory in Japan.
23.5 After reading the text in Exercise 23.1, answer the question: what were the consequences on trade of the tensions between China and the USA?
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Soluzione suggerita: The consequences were a fall in the export of goods that caused chips to be accumulated in warehouses instead of being sold, thus reducing the Western supplies.
23.6 After reading the text in Exercise 23.1, answer the question: what were the production problems connected to the war in Ukraine?
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Soluzione suggerita: The war in Ukraine led to an exponential increase in the cost of gas, which is very important for industrial production, and to a reduction of the supplies, slowing down the chip production and increasing its cost.
23.7 After reading the text in Exercise 23.1, answer the question: what did the 2020-2023 chip shortage make clear?
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Soluzione suggerita: It made it clear that the chip industry is extremely important.
23.8 After reading the text in Exercise 23.1, answer the question: what are the possible solutions to avoid more shortages in the future?
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Soluzione suggerita: To build new semiconductor factories spreading them across different regions, to expand existing ones, and to develop new technologies and materials to reduce the dependence on traditional silicon-based chips.