Study identifies risks for UK semiconductor industry

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A new study has found that geopolitical risks posed by growing US-China tensions are among those that threaten to derail the UK’s semiconductor industry.

Demand for microchips is expected to grow exponentially
Demand for microchips is expected to grow exponentially - AdobeStock

The new analysis of supply chains and foreign investment by researchers from Sussex University and King’s College London reveals a complex reliance on China and America, leaving UK firms vulnerable to the ongoing trade war between the two superpowers.

In a statement, Dr Steven Rolf, senior research fellow in the Digital Futures at Work Research Centre, Sussex University Business School said: “We found more than a quarter of shares in the UK’s semiconductor firms are held by US investors. Add this to a huge reliance on US suppliers and a persistent, if uncoordinated, pattern of Chinese investments and there’s trouble brewing.

“We may enjoy a special relationship with the US, but over-reliance on any one country makes for a risky industrial strategy. As the Presidential election gets closer neither candidate is backing down from the tech war with China. We may end up stuck in the middle, with UK firms exposed to high geopolitical risk.”

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