After receiving appeals for assistance from the leaders of some of the nation’s top companies, the U.K. said on Friday that it would provide up to £1 billion ($1.24 billion) in support for its semiconductor sector. The goal is to increase local chipmaking capacity and stop additional supply shortages.
The investment will be a part of a 20-year semiconductor strategy that will outline how the U.K. intends to safeguard its chip supplies and guard against threats to national security but has been subject to protracted delays.
The strategy, which will be released later on Friday, lays out a number of initiatives targeted at expanding the domestic chip market in the United Kingdom, reducing the risk of supply chain disruptions, and preserving national security.
As part of its plan, the United Kingdom will seek to deepen its relationships with foreign partners. In order to increase cooperation on defense and semiconductors, Britain and Japan reached an accord this week in Hiroshima.
The government announced that it will first invest up to £200 million from 2023 to 2025 before increasing its commitment to up to £1 billion over the next ten years. Access to prototyping, tools, and business assistance will be improved thanks to the investment.
British Prime Minister Rishi Sunak said in a statement that semiconductors are the building blocks of the electronics we use every day and will be essential to developing future innovations.
“Our new strategy focuses our efforts on areas like research and design where we are strongest so we can strengthen our competitive edge on the global stage,” the strategy reads.
We will expand our economy, add new employees, and maintain our position at the forefront of technological advancements by boosting the capacity and resilience of our semiconductor sector, which is the most successful in the world.
The U.K. will seek to expand collaboration with foreign partners to boost the resilience of the global chip supply chain, the government said, and new guidance will be released advising businesses of the risks of supply shocks.
In order to collaborate closely on shared solutions and execution, a panel of advisors made up of representatives from business, government, and academia has also been formed, it was noted.
“Applied appropriately”
The UK is laying out a separate strategy that tries to strengthen the sectors in which it is an expert rather than matching some of the massive spending commitments put forth by nations like the U.S. and EU.
Officials acknowledged that it wouldn’t be practical for the UK to construct its own enormous production facilities, similar to those used by Taiwan’s TSMC to produce the most cutting-edge chips.
They are instead concentrating on other facets of the semiconductor sector, like intellectual property, design, and the creation of non-silicon chips.
Although the government’s pledge of £1 billion is modest compared to those of the US and EU, according to Scott White, founder of the British chip company Pragmatic Semiconductor, it “actually feels like the right kind of number” that Britain’s sector requires. He did, however, issue a warning that the funds would need to be “applied in the right way.”
With a focus on the design, intellectual property, research, and production of sophisticated compound semiconductors, Britain is a relatively unnoticed participant in the worldwide chip business.
President Joe Biden of the United States signed the CHIPS and Science Act into law. This $280 billion package contains $52 billion in funds to increase American semiconductor production.
To produce 20% of the world’s semiconductors by 2030, the EU agreed on a funding package for the European semiconductor industry of 43 billion euros ($45.9 billion).
