COMMENT
Fuelling the Defence Industrial Strategy innovation goals from South Wales
In September 2024, the Ministry of Defence (MOD) purchased a semiconductor foundry in Newton Aycliffe, County Durham. This unusual step was not a move to expand capacity, but to prevent collapse of a critical sovereign supply chain.
T
his highly reactive move was a reminder of how exposed the UK’s defence industrial base has become to the loss of critical semiconductor capability. The question the Defence Industrial Strategy (DIS), published in 2025, now has to answer is how Britain moves from reactive crisis management to proactive sovereign resilience. The DIS sets out an ambitious answer. Its vision is for the UK to be “a leading tech- enabled defence power, with an Integrated constant innovation at wartime pace” by 2035. As geopolitical tensions continue to be exacerbated, that ambition feels less like a long-term strategy and more like an urgent necessity. The strategy is equally clear that defence must be an engine for economic growth recognising that a military is only ever as strong as the industrial base behind it. It names several frontier technologies, including semiconductors, AI, cyber and quantum, as priority areas with both military and economic growth potential, committing to raise defence spending to 2.5 per cent of GDP by 2027, with a longer-term ambition of 3.5 per cent. The proactive answer to the resilience question already exists. It is built, operating and growing in South Wales.
Compound semiconductors as an enabling technology
Compound semiconductors are not just one component among many in modern defence systems, they are the enabling layer across every layer of modern defence technology. Compound semiconductor materials have multiple uses across the sector. Gallium nitride (GaN) powers the high- frequency radio frequency (RF) systems at the heart of radar, electronic warfare and secure communications. Gallium arsenide missile guidance, with Indium phosphide (InP) enabling the photonic systems used in space and high-speed secure data transmission. Quite simply, you cannot build a tech-
6
The DIS prioritises dual-use technology as the route to both military advantage and economic growth, and here again, compound semiconductors are critical enabling technology. Every defence application has a direct commercial counterpart (RF comms in 5G/6G, power electronics in EVs and clean energy, photonics in AI data centres). This compares directly with tech advancements that have come from defence in the past, such as commercial air travel or the space exploration triggered by defence tech during the Cold War.
The DIS has committed £250M for Defence Growth Deal, across the UK built on local- national partnerships to develop sub-sector specialisms while delivering sustainable regional growth. Collaboration with the South Wales compound semiconductor cluster feels synonymous with advancing both the DIS’s security and growth objectives. Furthermore, at least 10 per cent of the Defence equipment procurement budget (£289B to 2033) is expected to be spent on future technologies. With directed energy weapons, autonomous systems and next-generation radars all
APRIL 2026 | ELECTRONICS FOR ENGINEERS
compound semiconductor dependent, the strategic case for partnership with the South Wales Cluster has never been stronger. The UK is currently strategically dependent on overseas sources for the manufacture of many of these components.
Conclusion
The Wales Defence Growth Deal has been signed. The Wales Defence and Security Cluster launched on 9 March. The Defence Supply Chain Capability Programme is live. The policy architecture to connect the compound semiconductor cluster to the UK’s defence industrial ambitions has never been more complete.
What is needed now is pace. With 90 per cent of Welsh semiconductor output currently exported, the sovereign opportunity is being realised elsewhere. Government investment decisions on supply chain alignment, technology roadmaps and procurement access must be made with the urgency the global semiconductor race demands, and with the recognition that the asset needed to deliver on the Defence.
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50
