British Prime Minister exempts 1 billion pounds for chip industry

British Prime Minister Rishi Sunak comes up with an investment strategy of 1 billion pounds (1.15 billion euros) for the national chip industry. The money should ensure that the country has caught up in the fierce global competition.

Rather than competing directly with the significant manufacturing subsidies from the United States and the European Union, the strategy will leverage the United Kingdom’s existing strengths in design and compound semiconductors. Important clusters in the British chip industry are Cambridgeshire and South Wales.

The corona pandemic has made it clear that the global economy is heavily dependent on Chinese and Taiwanese semiconductor manufacturers. These countries are an integral part of everything from iPhones to missile systems.

Chance of conflict in Taiwan has sparked chips race

The government has pledged around £200 million (230 million euros) in funding between now and 2025. A significant portion is earmarked for setting up a National Semiconductor Infrastructure Initiative. This initiative aims to unlock the potential of British chip companies. In addition, it includes plans to build an “open fab” for compound semiconductors, a key industry demand.

While the strategy emphasizes skills development in electrical engineering and computer science, details on immigration policies or visas for highly skilled workers are particularly lacking, despite industry warnings of talent shortages.

Scott White, executive director of semiconductor company Pragmatic, said he expects to work with the government in implementing the strategy. However, he pointed to the lack of information on commercial production, which means companies like his will have to wait until later this year for incentives to establish themselves in the country.

A confederation of factories that need chips

The government intends to encourage international partnerships as part of its investments, with Japan being the first cooperation partner, as Sunak outlined at the G7 summit. British officials believe Japan’s strengths in manufacturing complement the UK’s expertise in design.

Sunak stated, “By increasing the capabilities and resilience of our leading semiconductor industry, we will grow our economy, create new jobs and remain at the forefront of new technology breakthroughs.”

The United Kingdom is also in talks with South Korea, the United States and the European Union, all of whom are making significant investments in the industry.

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