PM unveils semiconductor plan to counter China’s threat to Taiwan

RISHI SUNAK will today launch Britain’s long-awaited £1bn semiconductor strategy as China’s threat to invade Taiwan puts global supply chains at risk.

The Prime Minister will hail the UK’S “world-leading semiconductor industry” in Japan as he unveils details of the strategy during the G7 summit in Tokyo.

The Government will spend £100m per year over the next decade on Britain’s chip sector, including the creation of a national institute for semiconductors. The Telegraph first revealed the £1bn pledge in January.

Plans include the creation of a new incubator for startups, separate from the existing Compound Semiconductor Applications Catapult, to nurture innovative hi-tech British chip startups.

It comes as Western leaders seek to nurture domestic semiconductor manufacturers to counter the growing risk that China invades Taiwan. The island nation produces over 60pc of the world’s semiconductors and has an even higher market share for the most advanced chips.

The US has already announced $57bn (£46bn) of subsidies to boost America’s chip industry.

Mr Sunak is expected to say: “Our new strategy focuses our efforts on where our strengths lie, in areas such as research and design, so we can build our competitive edge on the global stage.” Scott White, founder of Pragmatic Semiconductor, welcomed the strategy’s publication but said there were “question marks around the amount of funding”. It came as Britain’s only listed chip manufacturer was yesterday forced into an emergency cash call.

IQE, a maker of compound semiconductors, was forced to make around a tenth of its 650 staff redundant and raise £30m from its backers to stay afloat.

The Cardiff-based company, which is a supplier to Apple, blamed a “semiconductor market downturn”.

Shares in the company dropped over 10pc. Americo Lemos, chief executive of IQE, said he “expressed our commitment to stay here in Britain” but urged the Government to keep pace with the US and the EU on semiconductor investment.

Industry leaders had expected the strategy to be unveiled last year but the rapid fall of Boris Johnson’s and Liz Truss’s governments repeatedly delayed its publication, as did the reorganisation of Whitehall departments by Mr Sunak after he became Prime Minister.