Britain unveils $1.25 billion semiconductor strategy

May 19 (UPI) -- Britain unveiled plans Friday to invest up to $1.25 billion in microchip design, research and development and compound semiconductors to help the country's chip sector grab a larger slice of the global semiconductor market.

Under the National Semiconductor Strategy, the government will invest up to $250 million over the next two years to improve industry access to infrastructure, power more research and development and facilitate greater international cooperation. Over the next decade, it will put a further $750 million into a range of measures to secure Britain's global first-mover advantage, grow the domestic sector, mitigate supply chain disruptions and protect national security.

"By increasing the capabilities and resilience of our world-leading semiconductor industry, we will grow our economy, create new jobs and stay at the forefront of new technological breakthroughs," Prime Minister Rishi Sunak said.

The British government said its strategy is built upon consistent support to the semiconductor industry with $670 million in grants for research and $266 million directly to SMEs in the sector over the past 10 years, as well as funding 450 Ph.D. students since 2017.

It will also be backed by universities throughout the nation that are global leaders in the field, including in Cambridge which is home to semiconductor designer, Arm, whose microchips are used in up to 95% of all smartphones.

Sunak was in Hiroshima for the G7 summit Friday where Britain and Japan reached a deal to invest $2.5 million in early-stage semiconductor research starting next year.

"Semiconductors underpin the devices we use every day and will be crucial to advancing the technologies of tomorrow," he said. "Our new strategy focuses our efforts on where our strengths lie, in areas like research and design, so we can build our competitive edge on the global stage."

The strategy is a response to similar multibillion-dollar packages in the United States and European Union after industry leaders warned warned that British chip makers could be lured across the Atlantic, or to other countries with more competitive offers.

Competitors around the world have been ramping up investment to reduce their dependence on global supply chains of critically important semiconductors which were badly hit by the COVID-19 pandemic which saw production in major producers Japan, China and South Korea fall dramatically.

U.S. President Joe Biden signed the $280 billion CHIPS and Science Act in August, including $52 billion of funding to boost domestic manufacturing of semiconductor chips and other technologies critical to many U.S.-based supply chains.

Days later the EU responded by approving a $47 billion package aimed at boosting the bloc's 10% share of the global semiconductor market to 20% by 2030.