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No China is no fix for Britain’s industrial woes
ReutersNovember 17, 20229:01 PM GMT+8
LONDON, Nov 17 (Reuters Breakingviews) - The British government has blocked the sale of a silicon wafer factory in Wales to a subsidiary of China’s Wingtech Technology (600745.SS). It’s a sign of the growing wariness among western governments of the risks involved in Chinese investment. But Britain’s action looks muddled.
The decision to force Netherlands-based Nexperia to sell most of its stake in the Newport Wafer Fab business isn’t illogical. The plant makes basic silicon wafers, used in chips for switches in domestic appliances such as vacuum cleaners. The UK government fears it could produce sophisticated compound wafers, which can have military applications. And it worries that the Chinese link could make it hard for other companies in the Wales area to win new business with security implications.
But the acquisition happened over a year ago. Nexperia argues that it has since then offered multiple ways to address the government’s concerns, and was met with little dialogue in return.
The bigger question is what will now happen to the plant. Nexperia has invested 80 million pounds in the company, which was making losses in 2020. Its small-scale and relatively crude products may deter alternative bidders. The government may even need to provide financial support, and it has yet to announce a coherent plan for boosting the country’s semiconductor industry. Blocking deals is easy. Nurturing an industry is another matter.
Breakingviews - No China is no fix for Britain’s industrial woes
The British government has blocked the sale of a silicon wafer factory in Wales to a subsidiary of China's Wingtech Technology . It’s a sign of the growing wariness among western governments of the risks involved in Chinese investment. But Britain’s action looks muddled.
www.reuters.com
