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