The UK Government has announced details of a new National Semiconductor Strategy, backed by up to £1bn of funding.
The Government said that the scheme will boost UK strengths in areas such as chip design and research.
It is also intended to produce extra resilience in the supply chain and protect against potential disruption – the global semiconductor supply chain has faced major challenges over recent times, with a knock-on effect impacting a wide range of industries.
The £1bn of investment is a lot less than the CHIPS and Science Act in the US, which involves around $52bn of subsidies and incentives.
The EU has also recently launched the European Chips Act, which sets aside €43bn of funding up to 2030.
UK officials said that the amount spent was proportionate, however, as the UK strategy did not involve the building of fabrication plants.
These could cost up to $10bn, and the Government did not believe that such costs would be justified by the returns.
The UK will instead focus on areas where it believed it held a strategic advantage, such as the development of compound semiconductors.
These are made of multiple novel materials and enable future technologies that silicon chips are not suited for, including elements of autonomous driving and communications.
UK and Japan look to collaborate in the semiconductor industry
At the same time, the UK is looking to make deals with manufacturing centres in countries such as Japan.
The UK and Japan had previously made a commitment to collaborate in the semiconductor sector, in areas such as R&D and skills exchanges.
UK companies will be offered an initial round of £200m of funding between 2023 and 2025, with the remaining £800m to be allocated by the end of 2033.
In a statement, the Government said that semiconductors played a vital part in the modern world, enabling almost every piece of technology from power stations to mobile phones.
More than a trillion chips are produced each year and the global market for semiconductors is predicted to reach $1tn by 2030.
The Government added that semiconductors also underpinned crucial future technologies, including artificial intelligence (AI), quantum computing and upcoming 6G communications.
The three main stated objectives of the strategy are to boost the domestic semiconductor sector, mitigate the risk of further disruptions to supply chains, and protect national security.
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