Spain’s government fleshed out plans for a major push into the semiconductor and microchip industry, upping an initial investment announced last month by an additional €1.2 billion.

The government revised its investment from an initial €11 billion commitment, €9.3 billion of which is intended to finance domestic construction of leading-edge and mid-range semiconductor production plants.

It aims to complete the investment by 2027.

The cash will mainly be generated from European Union (EU) pandemic relief funds, set aside by the bloc towards addressing chip shortages and boosting the digital economy.

In a press conference covering the additional funding, Spain’s economy minister Nadia Calvino explained the EU funding “offer an extraordinary opportunity”.

Of the kitty, €1.1 billion will be set aside for R&D and €1.3 billion for chip design.

The programme further aims to develop a €200 million Chip Fund to support domestic start-ups and scale-ups in the semiconductor field, along with investing in strategic projects created at a European level by Spanish companies in the semiconductor field.

Spain’s push follows a global chip shortage triggered by the impact of Covid-19 (coronavirus) on production and supply chains.

The European Commission aims to boost the continent’s position through the EU Chips Act, a multi-billion euro initiative unveiled earlier this year.

And industry giant Intel committed €80 billion spend into boosting production in Europe, including establishing two manufacturing plants in Germany.