The Government should secure partnerships with strategic allies
to secure lucrative inward investment in the UK semiconductor
industry, according to a new report from the Business, Energy and
Industrial Strategy Committee.
MPs on the Committee singled out cooperation with the US under
the CHIPS Act and engagement with Taiwan as possible areas that
could yield opportunities for the industry.
Making international partnerships was something to be explored in
an overdue semiconductor strategy, the Committee said, adding
that the Government should publish without any further delay.
Chair's comment
Committee Chair said,
“The Government is putting UK plc at significant risk by failing
to take action in support of the semiconductor industry.
Other countries are investing in the resilience of their
semiconductor supply chains yet Ministers in the UK can’t even
publish their semiconductor strategy on time.
Semiconductors are essential components of modern technology and
in the infrastructure required to reach net zero. The industry is
expecting high growth in the coming decades, which is an
opportunity for us to leverage our strategic lead in design and
in energy-saving compound semiconductors.
Following the decision to require Nexperia to divest from its
Newport site, Ministers must proactively engage with potential
buyers to secure the future of our vital semiconductor cluster in
South Wales.”
The Committee’s report says that ‘it is not clear that the
support currently offered by the Government is at anything like
the scale which is needed to make a difference’. It said, the
semiconductor strategy should include ‘facilitating the design
and construction of new fabs’ – referring to semiconductor
production plants. Supporting a ‘open fab’ in South Wales, that
would allow any firm to produce at the facilities, should also be
considered, the report said.
Concerned by a worldwide shortage of semiconductors following
Covid-19 lockdowns, governments across the world, particularly in
the US and Europe, have been ploughing tens of billions of
dollars into semiconductor investment, including establishing new
fabs.
Globally, the semiconductor industry is worth more than $500bn
and, despite a recent dip in demand, is expected to expand to
over $1tn by 2030. Compound semiconductors could make up an
increasing share of this. They are critical for core components
in many items ranging from cars to washing machines and military
use to green technologies.
