UK government to boost local semiconductor production

According to people familiar with the proposals, the UK government would use direct public funding to support British semiconductor companies as part of a plan for a market that has turned into a hotspot of international geopolitics.

Officials familiar with the proposals have stated that the UK government plans to utilise direct public funding to bolster British semiconductor companies, as part of a strategy to address the heightened international geopolitical significance of the semiconductor market. This will include providing seed money for new businesses, assistance for scaling up existing ones, and further incentives for private venture capital.

To achieve its goal of increasing UK compound semiconductor manufacturing over the next three years, the government will establish a semiconductor task force to organize public and commercial support. Although the total amount of funding has not been determined by the Treasury, a source familiar with the plan predicts that it will likely be in the billions of pounds. The new strategy also includes investing additional funds in R&D, while simultaneously prioritizing diversification through alternative microchip sources from safe and friendly countries. This initiative to expand domestic semiconductor production aligns with the US’s efforts to restrict technology exports to China and limit its entry into the chip market.