London unveils billion-pound strategy

Prime Minister Rishi Sunak has announced an investment of 230 million euros over the next two years to help a key sector of the British economy.

The British government unveiled a strategy in semiconductors on Friday, providing for a billion pounds sterling (1.15 billion euros) of investment in the decade. This strategy has the stated objectives of stimulating the growth of the sector in the United Kingdom, reducing the risks of supply disruption and protecting national security. An investment of up to £200 million (€230 million) is planned for 2023-2025 to boost research and development and facilitate international cooperation.

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Highlighting the ubiquity of semiconductors in the modern world, British Prime Minister Rishi Sunak stressed that this strategy focuses British efforts on its “strengths, in areas such as research and design, so that we can strengthen our competitive edge on the global stage“. This strategy will allow economic development and job creation, and must allow the United Kingdom to remain “at the forefront of new technological breakthroughs“, he added. The government press release highlights the commitment made on the sidelines of the G7 summitin Japan to establish an ambitious semiconductor partnership with Tokyo, including through a joint investment of two million pounds sterling (2.3 million euros) next year.

Semiconductors are essential in industry, and in particular green technologies (batteries, wind turbines, solar) and digital, smartphones, connected cars or game consoles, but also military equipment. International tensions have increased in recent years around this strategic sector, with China and the United States in particular waging a fierce battle in this area. The European Union reached agreement last month on a plan to develop this industry on its own territory to reduce its dependence on Asia.

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AJ Bell analyst Russ Mould calls the announced billion in investment “pocket money compared to the 50 billion dollars and 43 billion euros recently unveiled in the United States and the European Union“. Lucy Powell, head of the opposition Labor party on culture and digital, also believes that the announced investment, which represents, according to her, “rather 200 million pounds over the next three years“, is very “lower than what our competitors put on the table“. The announcement in March by the British microprocessor manufacturer Arm, a subsidiary of the Japanese Softbank, that it was going to be listed on Wall Street and not in London, “offers little urance that we can maintain and grow this vital industry for national growth and security“, she adds.

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