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UK risks becoming ‘wholly owned subsidiary of China’ with Newport microchip factory sale

07 Apr 2022 3 minute read
Newport Wafer Fab picture by Robin Drayton (CC BY-SA 2.0).

The UK will become a “wholly owned subsidiary” of China if businesses like Newport Wafer Fab are sold to companies linked with the Chinese government, ministers have heard.

Lord Alton of Liverpool called on ministers to reveal whether the Government had any contracts with Newport Wafer Fab, which manufacturers microchips, and whether the Government would become “customers of the People’s Republic of China” if the deal goes ahead.

Nexperia, which intends to buy the semiconductor factory in Newport, is owned by Wingtech, a firm listed in Shanghai and believed to be backed by the Chinese Communist Party.

Lord Alton told peers the factory was “the United Kingdom’s biggest producer of microchips and semiconductors”.

He said: “It is about national resilience and it is about whether or not we wish to become a wholly owned subsidiary of the People’s Republic of China which has been accused of genocide by Elizabeth Truss, our Foreign Secretary.

“What can the minister tell us for instance about the value of contracts that his own department (BEIS) has had, that the Ministry of Defence perhaps more particularly has had, with Newport Wafer Fab?

“What is the value of those contracts and will they become customers of the People’s Republic of China should this deal go ahead?”

‘Crippling’

Business minister Lord Callanan replied that he could not reveal details of the Government’s considerations over the sale.

But the minister said: “I totally share his frustration about this and totally align with his remarks about the People’s Republic of China, the awful human rights abuses that are going on there and particularly the treatment of the Uighur people. There is no difference between us on that.

“Unfortunately this is a quasi-judicial decision that will be taken by the Business Secretary under the powers granted to him under the National Security and Investment Act that many of us debated at great length in this House.”

Liberal Democrat peer Lord Fox had earlier called on the Government to outline its position on the takeover.

He told peers: “The minister has said in the past that there are no specialist technologies at Newport Wafer Fab but that ignores the need for capacity, industrial capacity, to build technology.”

Lord Fox added: “There is a crippling shortage of microprocessors around the world that is hampering manufacturing.

“To combat that the EU and the US have strategies. We seem to be waiting and seeing. So to put this acquisition into context, can the minister tell us when we will have a plan and can the minister undertake not to sell this business, not allow it to be sold, until such a plan is forthcoming?”

Minister Lord Callanan replied that “DCMS (Department for Digital, Culture, Media and Sport) are working on a semi-conductor strategy which will also be published shortly”.


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Ernie The Smallholder
Ernie The Smallholder
5 months ago

This is the whole problem here on the British Isles. It is the same for most industries. If we want domestically owned industries we must be prepared to invest in them. Simple? But the problem is deeper, because of the extreme wealth inequality much of the population have not enough spare money to invest in their domestic industries. Which means it doesn’t get built or falls in overseas investors. This is why most tech companies are traded on NYSE. It is sad that although wind turbines will be the main solution to our energy needs few are owned in Wales.… Read more »

Grayham Jones
5 months ago

All business in wales must be run by welsh people only not incomers so all the money stays in wales 🏴󠁧󠁢󠁷󠁬󠁳󠁿 it’s time for a new wales kick all English party’s out of wales vote Plaid Cymru 🏴󠁧󠁢󠁷󠁬󠁳󠁿

I.Humphrys
I.Humphrys
5 months ago

The “Service” sector has taken over now, due to the genius M Thatcher hollowing out
our industry, American style. Cymru must get what it can take; wave the red dragon and get as much investment as possible, from wherever. That is realpolitik,and something we must learn as a small country. The people shouting freedom comes before bread all have luxury jobs in the European Union. Better if we can do it on our own, so Independence followed by loans from the IMF to buy the plant in question, but hurry up! It’s real quiet in the Senedd?

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