Mexico’s chip plan stands up to the US

Unpacking the Mexican government’s ambitious semiconductor industrial policy.

Europe didn’t wait for the dust to settle from the US-China trade war or the Covid-19 chip shortage. It saw the chaos and moved to return the semiconductor industry back to its shores. By 2023, the EU designed a plan, budgeted at €43 billion, to that effect.

Money in hand, member States distributed responsibilities according to their infrastructure and expertise. France and Germany got to become the centres for semiconductor factories (known as fabs). Holland was already strong in the materials needed for lithography, so the EU doubled down on that there. Spain got chip design and got to work on creating the Barcelona Supercomputing Center.

Over in Mexico, where no such initiative existed, Marco Antonio Ramírez Salinas, professor at the Centre for Computational Investigation at Mexico City’s National Polytechnic Institute (IPN) tinkered with challenges for his post-grads. Ramírez Salinas had got the idea from a colleague at MIT who taught by giving students concrete projects to learn from. One such project, started in 2010, really took wing.

It is called Lagarto (Alligator) and it is Mexico’s first domestically made processor. It was devised as a research project basically meant to follow in the steps of engineers past to land at a CPU from first principles. A few years in, they had not only done it, but had caught Europe’s eye.

The Barcelona Supercomputing Center asked, Ramírez Salinas said, if they could do a trade: Mexico City would transfer its technology to Barcelona, and Barcelona, in turn, would use its substantial funding to build an actual prototype chip—just one costs about $30,000 dollars—to see if the Mexican designs worked in practice.

The trade was a success. The Mexicans got the satisfaction of knowing their research was good. And, thanks to Lagarto, the Europeans were saved a decade’s work, Ramírez Salinas claims, which they put to work advancing the EU’s €43 billion-euro semiconductor masterplan.

“Wait, what?! How was that a fair trade?”, The Mexico Political Economist asked.