South Wales to host world's first Compound Semiconductor Cluster

The UK is set to get a new semiconductor industry cluster in South-East Wales, following the signing of a deal that will see the government contributing £37.9 million to the project.

The deal, signed yesterday, sees ten councils fronting up cash and acting as investors in a company dubbed Compound Semiconductor Cluster (CSC) Foundry Limited, or LDC Ffowndri in Welsh, which works in the area of compound semiconductors - the devices which are set to replace traditional silicon semiconductors should any of them ever leave the lab. The idea, as with any commercial investment, is that the £37.9 million will be repaid with interest over the life of the project thanks in part to previous investments totalling around £62 million from the Welsh government and Innovate UK.

'The objective of this commitment is to create a complete compound semiconductor ecosystem in South Wales to take advantage of the growing prominence of compound semiconductor technologies,' claims Councillor Peter Fox, leader of Monmouthshire County Council and deputy chair of the CCR City Deal Regional Cabinet which oversaw the investment. 'The opportunity this investment creates, to help the establishment of the world's first compound semiconductor cluster in South East Wales, should not be underestimated. It has the potential to place our region at the heart of this cutting edge sector and will require the development and integration of a compound semiconductor supply chain in South Wales, with the economic and social benefits that will bring.'

'Compound semiconductors are at the heart of many devices we use today, from smart phones to tablets and satellite communication systems. It is an area of UK strength and today's confirmation of the development of a cluster of excellence in Wales reinforces our own strong position in the growth of this important and growing technology,' adds Secretary of State for Wales Alun Cairns. 'Of course, government does not create innovation, but it can be a catalyst to getting the scientists and engineers, the designers and the entrepreneurs together to make it happen. This collaboration is important because innovation is a shared endeavour and I look forward to seeing the cluster take shape and create a lasting engineering and manufacturing legacy in Wales.'

'It is hugely encouraging that Welsh government's initial £12 million investment in developing the cluster back in 2015 has been the catalyst for today’s announcement that IQE plans to expand into the City Deal's new facilities. Not only is it extremely exciting news for the Welsh economy, securing additional jobs and investment, but it further cements Wales as a world leader in this state of the art technology,' offers Economy Secretary Ken Skates. 'With the world's first compound semiconductor cluster located here in South East Wales, we are punching well above our weight in developing technology which not only plays an increasingly vital role in the way we live our lives today but will drive innovation which will shape the world we live in tomorrow.'

The deal will, its proponents claim, bring up to £375 million of private sector investment, create 2,000 direct employment opportunities and 'hundreds more' indirect supply chain jobs, and allow the returned investment to be used in other regional schemes. The ten councils involved have been named as Blaenau Gwent, Bridgend, Caerphilly, Cardiff, Merthyr Tydfil, Monmouthshire, Newport, Rhondda Cynon Taf, Torfaen, and The Vale of Glamorgan.