Dear IPC Members:   To close out this snowy and cold week in Chicago and Washington, DC, I’m pleased to share this quick, five-minute review of IPC’s global public policy advocacy. It may have been cold outside in Chicago but it was toasty warm inside with lots of collaboration and camaraderie at the annual IPC All-Staff meeting. We devoted a morning session to learning how to leverage the value of our diversity, and there were several sessions of team-building and strategizing on ways to better serve our IPC members and stakeholders. Let me also flag for you the newest edition of IPC Community magazine, which includes a fascinating article by IPC Chief Economist Shawn Dubravac on Mexico's ascent in becoming the United States' premier trading partner, propelled by the nearshoring trend. Read a quick summary in our top news of the week below and read IPC Community for more news and insights on our electronics community. As always, we invite you to reach out with any feedback or questions. All the best,

Chris Mitchell
Vice President, Global Government Relations

The Headlines at a Glance: 

TOP NEWS OF THE WEEK 

• Is Mexico Overtaking China Through “Nearshoring”?

QUOTE OF THE WEEK 

• On Building a Skilled Workforce in the CHIPS and Science Context

UNITED STATES

• Bipartisan Tax Agreement Would Aid Electronics Manufacturers
• Pentagon Releases First-Ever U.S. National Defense Industrial Strategy
• House Panel Calls for a “Reset” of U.S.-China Tech Relations
• IPC Applauds $46M Grant for IC Substrates and Advanced Packaging

EUROPEAN UNION

• IPC Offers Insights on Advanced Materials to European Commission
• Industrial Strategy Remains Priority as Belgium Assumes EU Presidency

ENVIRONMENT AND HEATH

• European Commission Proposes Streamlined Chemical Assessments
• EU Institutions Act on Sustainability Due Diligence Directive
• EU Maintains Status Quo on Restriction of Hazardous Substances Directive

UPCOMING EVENTS

• IPC WinterCom 2024, Jan. 22-25
• WHMA Global Leadership Summit, Feb. 13-15
• IPC APEX EXPO 2024, April 6-11

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TOP NEWS OF THE WEEK

Is Mexico Overtaking China Through Nearshoring? Amid rising geopolitical and trade challenges, nearshoring is gaining traction as companies seek to bring production closer to consumer markets, writes IPC Chief Economist Shawn Dubravac the newest edition of IPC Community magazine. Mexico is emerging as a key industrial hub, surpassing China as the U.S.'s top trading partner. In 2023, Mexico's foreign direct investment soared, particularly from U.S. firms in the automotive and computer manufacturing industries. As China's share of U.S. imports is falling, Mexico and other Asian nations are on the rise, revealing a shift towards diversified supply sources. The shift is also seen in Europe, where Eastern European countries are becoming locations for enhanced supply chain resilience and sustainability. Read this story and more in the latest issue of IPC Community IPC Contact: Shawn DuBravac.

QUOTE OF THE WEEK

	“The national security, industrial, and economic development goals of the CHIPS push will not be achievable without a major surge of STEM and tech talent development… And so the workforce components of the bill are not just supplementary — they’re central and crucial."
– Martha Ross  and Mark Muro of the Brookings Institution on the importance of building a bigger skilled workforce in support of the CHIPS and Science Act, as quoted in a recent Work Shift blog post.

UNITED STATES

Bipartisan Tax Agreement Would Aid Electronics Manufacturers: The U.S. House and Senate tax-writing committees have reached a bipartisan agreement with significant implications for electronics manufacturers. The deal, if enacted, would permit immediate expensing of domestic research and development costs retroactively from January 1, 2022, to December 31, 2025, replacing the five-year amortization span and potentially reducing the tax burden on recent and ongoing innovations. It also would maintain deductions for depreciation through 2024 and 2025 and extend 100% bonus depreciation on new machinery, equipment, and vehicle investments until 2025, facilitating capital expansion plans. Moreover, the agreement would alleviate international tax complications by abolishing double taxation for entities operating in both the U.S. and Taiwan. IPC Contact: Rich Cappetto.

Pentagon Release First-Ever U.S. National Defense Industrial Strategy: The U.S. Department of Defense on Jan. 11 issued its first-ever National Defense Industrial Strategy (NDIS), outlining a five-year roadmap centered on enhancing Resilient Supply Chains, Workforce Readiness, Flexible Acquisition, and Economic Deterrence. The strategy resonates with IPC's advocacy for a strengthened electronics industry, particularly in fostering resilient supply chains and a skilled workforce, especially in light of the objectives of the CHIPS and Science Act. While sector-specific recommendations were not included, upcoming implementation plans are expected to detail further actions. IPC has been advocating for a “silicon-to-systems” approach to strengthening the electronics supply chain, and the DoD strategy acknowledges the need to collaborate with industry, send clear market signals, and work in partnership with U.S. allies. Read more and access the strategy via the IPC Blog.IPC Contact: Rich Cappetto.

Hounel Calls for a “Reset” of U.S.-China Tech Relations: A U.S. House panel recently released nearly 150 bipartisan policy recommendations aiming to "reset" the U.S.-China economic relationship and technological competition. The recommendations focus on mitigating national security risks and ensuring U.S. technological competitiveness by reducing reliance on Chinese technologies and supply chains, particularly in the electronics industry. The panel advocates for bolstering U.S. manufacturing capabilities in areas including printed circuit boards (PCBs) and emphasizes the importance of a skilled workforce. IPC supports the move towards reinforcing North American supply chains and developing domestic capabilities while maintaining a commitment to free and fair global trade, competition, and reliability standards. IPC Contact: Rich Cappetto.

IPC Applauds $46M Grant to IPC Member GreenSource for IC Substrates and Advanced Packaging: IPC congratulates GreenSource Fabrication LLC upon receiving a $46.2 million grant from the U.S. Department of Defense to enhance U.S. capabilities in integrated circuit (IC) substrate fabrication and advanced packaging. The grant is one in a series of investments by the DoD aimed at reinforcing the domestic electronics supply chain, with more anticipated in the coming months. IPC has been actively collaborating with DoD and industry partners to advocate for the expansion of U.S. advanced packaging capabilities, including IC substrate fabrication. Learn more about IPC’s work on advanced packaging. IPC Contact: Chris Mitchell.

EUROPEAN UNION

IPC Offers Insights on Advanced Materials to European Commission: Last week, IPC played a pivotal role in guiding the European Commission on the nuanced requirements of the electronics sector, particularly concerning advanced materials. With an eye on issuing a comprehensive Communication on Advanced Materials in 2024, the Commission engaged with prominent industry stakeholders for their insights. IPC's submissions emphasized the critical importance of adopting a holistic silicon-to-systems framework for the evaluation of electronic materials. Additional insights and context will be detailed in an upcoming blog post. IPC Contact: Alison James.

Industrial Strategy Remains Priority as Belgium Assumes EU Presidency: Belgium has assumed the Presidency of the Council of the European Union for the first half of 2024, from January 1 to June 30. For its 6-month mandate, industrial competitiveness will continue to be an essential theme. Under its mandate in the Council, the Belgian Presidency will address topics including economic security, reducing harmful dependencies, and promoting critical technologies. With 2024 as a year of political change in the European Union, IPC will be continuing to work with the EU Institutions to highlight the critical importance of bolstering Europe’s electronics manufacturing ecosystem from silicon to system. Read more about the priorities of the Belgian presidency of the Council of the European Union. IPC Contact: Alison James.

ENVIRONMENT AND HEALTH

European Commission Proposes Streamlined Chemical Assessments: The European Commission is reviewing three legislative proposals aimed at reforming chemical assessments across the EU. The "One Substance, One Assessment" initiative seeks to create more efficient, consistent, and transparent processes by redistributing tasks among the European Chemicals Agency, European Food Safety Authority, European Environment Agency, and European Medicines Agency. The proposals include the establishment of a Common Data Platform for chemicals information; the systematic collection of human biomonitoring data; and the implementation of a framework for early detection of chemical risks like PFAS. The proposals are part of the Chemicals Strategy for Sustainability and are within the framework of the EU's zero pollution goal outlined in the European Green Deal. They will now be reviewed by the European Parliament and the European Council. IPC Contact: Kelly Scanlon.

EU Institutions Act on Sustainability Due Diligence Directive: The European Parliament, together with the Council of the EU, has provisionally agreed on the definitive wording of the Corporate Sustainability Due Diligence Directive (CS3D). The directive introduces rigorous obligations for companies to follow in identifying, forestalling, diminishing, and rectifying both direct and potential adverse effects on human rights and the environment that may stem from their own activities, those of their subsidiaries, or those that occur within their value chain. The landmark agreement is on track to be formally adopted in early 2024, after which EU Member States will have a two-year period to adopt the provisions in national legislation. IPC Contact: Kelly Scanlon .

EU Maintains Status Quo on Restriction of Hazardous Substances Directive: In its concluding report on the evaluation of the Restriction of Hazardous Substances (RoHS) Directive, the European Commission has determined that an immediate update to this benchmark regulation is unwarranted at this time. Responsibility for the technical scrutiny of applications for exemptions, as well as the groundwork for incorporating new substances under the directive’s scope, will be transitioning to the authority of the European Chemicals Agency (ECHA). In response to this development, IPC is mobilizing its Environment & Health Strategic Management Team to conduct an in-depth analysis of the report’s primary conclusions. Our review will aim to illuminate the implications for the electronics industry and guide compliance strategies. IPC Contact: Kelly Scanlon.

IPC WinterCom 2024: Barcelona, Spain, Jan. 22-25. Kicking off next week, WinterCom 2024 will convene IPC standards development committees from around the globe for a week of face-to-face sessions. The event is free to both IPC members and non-members with an interest in IPC standards development. Register today!

WHMA Annual Global Leadership Summit: Myrtle Beach, S.C., Feb. 13-15. Formerly the WHMA Annual Conference, the WHMA's Annual Global Leadership Summit is a networking event for executives representing wire harness manufacturers, OEMs, and suppliers for companies that build wiring harnesses and cable assemblies. Register today!

IPC APEX EXPO 2024: Anaheim, Calif., April 6-11. The largest electronics manufacturing event in North America, IPC APEX EXPO features the newest innovations and the best minds in the industry. APEX EXPO 2024 will also host the Electronic Circuits World Convention (ECWC) 16, an international PCB symposium held every three years, featuring the latest information on global PCB demand, PCB manufacturing processes, and promoting the domestic PCB industry in every country and every region. Register by March 1 for a 20% discount!

PLEASE "LIKE" AND "SHARE" OUR LINKEDIN POSTS

Wrapped up my second electrifying day at CES 2024. The buzz around electronic innovation has been contagious! As I walked through the show floor, I noticed one big and important trend that’s a major focus for IPC: sustainability. Sustainability is the key to a greener future with smart cities, homes, and every gadget we encounter.		“IPC is encouraged to see that the NDIS highlights several key priorities which we have been urging in recent years on behalf of the electronics industry." Read our full statement.

KEEP IN TOUCH WITH US 

Meet the IPC GR Team: Whether it is engaging with policymakers in the Americas, the European Union, or Asia, the IPC Government Relations (GR) Team proactively seeks opportunities to educate, inform and influence policymakers on policies that spur innovation, growth and competition, while protecting human health and the environment. But our success depends on your support and engagement. Learn more and get involved in IPC advocacy today! IPC Contact: Chris Mitchell.   

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