IBM and the federal and Quebec governments have agreed to invest $187 million in the expansion of the company’s semiconductor plant in Bromont, Que.

The investment includes the creation of a new research and development facility, a news release and Bloomberg report indicate. The development will create 280 skilled jobs.

Ottawa is slated to invest about $60 million in the project, while the province has pledged approximately $40 billion. Some of the funds will go to the Bromont-based MiQro Innovation Collaborative Centre, a research organization dedicated to accelerating the development of digital technologies.

The plant serves multiple industries that rely on microchips. During a news conference in Bromont, Prime Minister Justin Trudeau said the investment will support a vital industry, further the reshoring of microchip development in North America and avoid potential supply-chain and economic problems in the event of political unrest in China and Taiwan, where many of the world’s computer chips are produced.

The R&D efforts will develop methods for scalable manufacturing and other advanced assembly processes to support the packaging of different chip technologies, to further Canada’s role in the North American semiconductor supply chain and expand and anchor Canada’s capabilities in advanced packaging, according to a news release.

The chip packaging process involves connecting integrated circuits on a chip or circuit board.

The 52-year-old Bromont plant spans 800 acres and ranks among North America’s largest chip assembly and test facilities. It is linked to IBM’s microchip . The investment in Bromont will help to further establish and is linked with IMB microchip innovation corridor between Bromont and New York state, according to a news release.

Bloomberg reported that the R&D centre project is part of an IBM investment of more than $1 billion (US$730 million) in the expansion of the Bromont plant. The larger investment will be carried out over the next five years.

Jamie Thomas, general manager of technology lifecycle services at IBM, confirmed the $1-billion investment in Bromont to Bloomberg.

“Even if we produce the processors at factories in the US or Canada, we would then have to send them back to Taiwan for packaging,” she told the wire service. “What you really need is a full supply chain onshore.”