Spain has approved a plan to spend 12.25 billion euros ($13.12 billion) on the semiconductor and micro chip industry by 2027, including 9.3 billion euros to fund the building of plants, Reuters news report said.
Global semiconductor revenue is forecast to grow 13.6 percent to $676 billion in 2022, according to a Gartner report in April.
“The semiconductor average selling price (ASP) hike from the chip shortage continues to be a key driver for growth in the global semiconductor market in 2022, but overall semiconductor component supply constraints are expected to gradually ease through 2022 and prices will stabilize with the improving inventory situation,” said Alan Priestley, research vice president at Gartner.
Spain’s program for the semiconductor industry that consists mostly of European Union pandemic relief funds is directed towards the digital economy and demand created by chip shortages. It was originally set at 11 billion euros when announced by Prime Minister Pedro Sanchez last month.
“The aim is to develop the design and production capacities of the Spanish microelectronics and semi-conductor industry, covering the entire value chain from design to chip manufacturing,” Spain’s Economy Minister Nadia Calvino said on Tuesday, during a news conference after the weekly cabinet meeting.
A surge in demand amid the pandemic and supply chain problems created shortage of micro chips and forced manufacturers to slow down production, including in Spain where car makers Volkswagen and Renault partly idled assembly lines.
The plan will finance semiconductor production capacity in leading-edge (below 5 nanometers) and mid-range (above 5 nanometers) semiconductor manufacturing with a 9.3 billion euro investment.
It will fund research and development with a 1.1 billion euro subsidy and 1.3 billion euros will be allocated to chip design. It will also support Spanish companies in strategic projects developed at the European level and will create a 200 million Chip Fund to finance start-ups and scale-ups in the Spanish semiconductor sector.
