A COMMITTEE of MPs has urged the UK Government to act fast and secure the future of a Newport microchip manufacturer.

The government intervened earlier this month to stop the sale of Newport Wafer Fab to the firm Nexperia, the parent company of which some say has links to the Chinese government.

A cross-party group of MPs who sit on the Business, Energy and Industrial Strategy Committee have now proposed the creation of a new a "open fab" in South Wales, that would allow any firm to produce at facilities there.

The committee warned the UK was "missing out" on semiconductor inward investment as international competition in the sector heats up.

In a new report, it said the government should secure partnerships with strategic allies to secure lucrative investment in the UK semiconductor industry.

Making international partnerships was something to be explored in an overdue semiconductor strategy, the Committee said, adding that the UK Government should publish without any further delay.

Committee chairman Darren Jones said: "The Government is putting UK plc at significant risk by failing to take action in support of the semiconductor industry.

"Other countries are investing in the resilience of their semiconductor supply chains yet ministers in the UK can’t even publish their semiconductor strategy on time.

"Semiconductors are essential components of modern technology and in the infrastructure required to reach net zero. The industry is expecting high growth in the coming decades, which is an opportunity for us to leverage our strategic lead in design and in energy-saving compound semiconductors.

"Following the decision to require Nexperia to divest from its Newport site, ministers must proactively engage with potential buyers to secure the future of our vital semiconductor cluster in South Wales."

Concerned by a worldwide shortage of semiconductors following Covid-19 lockdowns, governments across the world, particularly in the US and Europe, have been ploughing tens of billions of dollars into semiconductor investment, including establishing new fabs.

Globally, the semiconductor industry is worth more than $500bn and, despite a recent dip in demand, is expected to expand to over $1tn by 2030.  Compound semiconductors could make up an increasing share of this. They are critical for core components in many items ranging from cars to washing machines and military use to green technologies.