A new report by Policy Exchange warns that the UK has fallen behind in the semiconductor race, with no large, broad-based semiconductor manufacturer comparable to the three leading European companies: Infineon in Germany, NXP in the Netherlands, and the Franco-Italian group, STMicroelectronics.

Authored by Sir Geoffrey Owen, Head of Industrial Policy at Policy Exchange and former Editor of the Financial Times, it argues that in order to deliver the Government’s ambitions for growth, our industrial strategy should focus on building a distinctive position in a sector of the market – compound semiconductors – where the UK already has considerable strengths.

A key recommendation is for Government, in partnership with industry, to support the construction of an open access foundry for compound semiconductors – which could play the same role in stimulating the industry as silicon-based foundries play in Europe, the US and Asia.

Backing the report, Ruth Jones MP, Chair of the All-Party Parliamentary Group for semiconductors, says that the creation of an open access foundry would be “transformative for the future of the industry, and is something I hope that Government will consider adopting as part of its industrial strategy.”