SHARE
COPY LINK

ECONOMY

Spain to invest €11 billion to become Europe’s microchip factory

Spanish Prime Minister Pedro Sánchez on Monday announced his government will use €11 billion of EU funds for Spain to become a manufacturer of microchips, key components in our digital world and an element of "global geostrategic importance”. 

Spain to invest €11 billion to become Europe's microchip factory
The Spanish government doesn't want to miss out on the chance to make Spain the leading producer of microchips in Europe.(Photo by JENS SCHLUETER / AFP)

Spain wants to lead the way in Europe in terms of microchip and semiconductor development. 

In the words of Pedro Sánchez at the ‘Wake up, Spain’ tech conference on Monday April 4th: “The Spanish government wants our country to be at the forefront of industrial and technological progress”.

Microchips and semiconductors are everywhere and needed for all manner of modern technology to function. Digital products in everyday life such as smartphones, digital cameras, televisions, washing machines, cars, fridges, medical devices and LED bulbs all use these tiny integrated circuits.

In 2020, more than 932 billion chips were manufactured around the world and in 2021 production continued growing into a €550 billion industry.

Covid-19 restrictions led to a global shortage of microchips and semiconductors as well as supply chain bottlenecks, in part as a result of their production still being mainly centred in Asia, namely in Taiwan. 

“Semiconductors are essential elements in all energy sectors and acquire global geostrategic importance in the context of digital transformation”, Sánchez stressed.

His words come at a time when the war in Ukraine has forced many European countries to question their dependency on Russian natural gas and their lack of self-sustainability overall.

Spain’s Prime Minister highlighted that Spain is at the centre of economic recovery plans in Europe and that it has already received €19 billion from the European Commission.

“Receiving the funds was the first of the challenges, but the important challenge now is to execute (the measures) quickly and efficiently,” he added, and that “they have an impact on people’s daily lives”.

US tech giant Intel is also set to invest an initial US$17 billion (€15.4  billion) to build a semiconductor factory in Germany and R&D facilities in France, Poland and Ireland.

The Spanish government is yet to give more details about what its new €11 billion microchip plan will consist of, but it is set to be approved by the European Commission soon.

READ ALSO – Meta, IBM, Google, Amazon: How thousands of tech jobs are being created in Spain

Member comments

  1. This is great news. An excellent opportunity to rejuvenate Spain’s industrial regions and stabilise the supply and price of essential electronic components within the EU.

Log in here to leave a comment.
Become a Member to leave a comment.

UKRAINE

Why meat prices in Spain will rise if the war in Ukraine continues

Rising cereal prices caused by the war in Ukraine are having a knock-on effect on meat prices in Spain, and things could get worse if the war continues.

Why meat prices in Spain will rise if the war in Ukraine continues

You might not have known that cereals are key to the meat industry, but you may have noticed meat and poultry prices rising on supermarket shelves. The feed eaten by animals, such as pigs, is usually made up of around 20 percent corn, and the rise in cereal prices is now affecting the rest of the food chain, and meat prices in Spain in particular.

Experts are now warning that prices could continue to rise if the war in Ukraine continues. This is because Russia is the world’s main producer of grain crops, a key ingredient in many animal feeds. A continuation of the war could therefore lead to further price increases that could indirectly affect all animal products such as ham, eggs, and milk.

READ MORE: Products that are more expensive than ever due to the war in Ukraine

Meat prices in Spain were rising even before the outbreak of war in Ukraine, and have climbed by 18 percent in the last year. 

The added economic shock of war, though, has caused meat prices to spike: beef prices, for example, have risen by almost 1 percent a week since March.

Jesús, a livestock owner, explained to Spanish outlet La Sexta that feeding his animals accounts for around 80 percent of the cost of production for his business, therefore, if cereal prices continue to climb, so will the price of his product.

This extra cost will then be passed on to consumers in supermarkets. “The [price of the] shopping cart is going up and it is logical, there is no other way to do it, products are going to be much more expensive,” he said.

The conflict-induced price spikes come amid tough economic times in Spain, not only because the country is still recovering from the COVID-19 pandemic, but also because Spaniards have been feeling the pinch of inflation in the last year. 

READ MORE: Products made more expensive than ever due to inflation

Last October, electricity bills were sixty-three percent higher than the previous year, according to statistics from Spain’s Instituto Nacional de Estadística (INE). Spain’s Consumer Price Index (CPI) ended 2021 at 6.5 percent – fractionally lower than forecast but still the highest level in almost thirty years.

According to a recent survey by the Bank of Spain, 60 percent of national companies plan to raise their prices in the coming year. 

SHOW COMMENTS