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It has not (yet) become the 5 to 8 billion that Mayor Jeroen Dijsselbloem recently requested, but with a commitment of 2.5 billion euros, the Brainport region can breathe a sigh of relief. The government and the Eindhoven region jointly deploy that amount to strengthen the local microchip sector. The investment focuses on talent development, infrastructure, and housing, emphasizing improving Eindhoven’s attractiveness to the high-tech industry.

Why this is important:

The recent announcement by chip machine manufacturer ASML that it was considering expanding outside the Netherlands caused an uproar within the cabinet. The reaction came quickly.

Mayor Dijsselbloem did not want to wait for a new cabinet with his emergency appeal. “Even an outgoing cabinet must simply do what is in the national interest,” he said in an interview on Dutch Radio 1. “We are in danger of being paralyzed by reality in The Hague. This is an acute issue and cannot wait six months.”

The financial boost will benefit Eindhoven University of Technology and other educational institutions. The move follows warnings from ASML about the Dutch business climate, and the intention is to retain the company and similar high-tech companies for the region.

The central government invests 1.7 billion euros, while the Eindhoven region contributes 800 million. The money is earmarked not only for talent development through educational institutions but also for key infrastructure projects and housing, which should make the region much more attractive to both domestic and foreign talent.

Focus on infrastructure and housing

Infrastructure projects include improving highways and rail connections and improving Eindhoven’s accessibility. This is an essential factor for companies like ASML, which attract employees from different parts of the country and even abroad. In addition, nearly 20,000 new homes are being built in the region to meet the increased demand for housing due to industry growth.

The investment plan, also known as “Project Beethoven,” is intended to ensure that large companies such as ASML and NXP remain in the Netherlands and that the Brainport Eindhoven region does not hit its capacity limits. This project is vital given ASML’s recent warnings about the Dutch business climate. ASML’s top executive, Peter Wennink, expressed concern that the company might be forced to move investments abroad without improvements.

Talent development

Eindhoven University of Technology plays a central role in the talent development plans. The university will receive part of the investment to strengthen technical education and support the microchip sector’s future needs. Vocational educational institutes in the region will also receive financial support, which should lay the foundation for a strong influx of highly qualified personnel.

The government has clarified that it expects ASML to remain in the Netherlands after these investments. Should ASML’s plans change, the cabinet will review the projections and the commitment required. It is a clear warning to ASML that the government expects the company to take responsibility after the extensive investment.

Financing and tax measures

The financing of this project is largely in place, with contributions from the state and the region and part from the National Growth Fund. Still, there are challenges. For example, the Cabinet has proposed tax measures, such as scaling back the expat scheme and a tax on share buybacks, causing discontent within the business community. These measures are intended to finance other parts of the plan, but exact coverage has yet to be found.

In addition to economic considerations, strategic interests also come into play. The microchip sector contributes to the security and independence of the Netherlands from other countries. So, keeping this sector within the country’s borders is not only a matter of employment and economic growth but also of national security.