Dr Wynne Metedis, Chair of CSconnected, discusses the UK Government’s vision for compound semiconductors and how it will further the objective of sovereign defense capability.
In September 2024, the Ministry of Defense (MOD) purchased a semiconductor manufacturing facility in Newton Aycliffe, County Durham. This unusual move was not meant to expand production capacity, but to prevent the collapse of vital sovereign supply chains.
This facility, Octric Semiconductors UK, was the only facility in the UK capable of producing gallium arsenide chips for military platforms, including fighter avionics. The previous owners were considering selling or closing. Losing it was considered a national security risk, so the government intervened.
This highly reactive move was a reminder of how the UK’s defense industrial base is exposed to the loss of vital semiconductor capabilities.
The question that the Defense Industrial Strategy (DIS), due to be published in 2025, must now answer is how the UK will move from reactive crisis management to proactive sovereignty resilience.
Defense Industrial Strategy Goals
DIS offers an ambitious answer. The vision is for the UK to become, by 2035, “a leading, technology-enabled defense power with the collective capacity to deter, fight and win through continuous innovation at wartime pace”.
As geopolitical tensions continue to worsen, that ambition feels more like an urgent need than a long-term strategy. This strategy recognizes that the military is only as strong as the industrial base behind it, and is equally clear that defense must be the engine of economic growth. The report identifies several frontier technologies, including semiconductors, AI, cyber and quantum, as priority areas with potential for both military and economic growth, and commits to raising defense spending to 2.5% of GDP by 2027, with a long-term goal of 3.5%.
Positive answers to the problem of resilience already exist. Built, operated and grown in South Wales.
Compound semiconductors as an enabling technology
The recognition that semiconductors are a priority supply chain vulnerability alongside steel, batteries, rare earths and energy materials creates a significant opportunity to leverage the strengths of CSconnected, the world’s most integrated compound semiconductor cluster located in South Wales.
Compound semiconductors are not just one component among many in modern defense systems; they are an enabling layer across all layers of modern defense technology. Compound semiconductor materials are used in a variety of applications across fields.
Gallium nitride (GaN) powers high-frequency radio frequency (RF) systems that are central to radar, electronic warfare, and secure communications. Gallium arsenide (GaAs) underpins fighter jet avionics and missile guidance, while indium phosphide (InP) enables photonic systems used in space and fast, secure data transmission. Simply put, we cannot build a technologically-enabled fighting force without them.
DIS prioritizes dual-use technologies as a path to both military advantage and economic growth, and here again compound semiconductors are a key enabling component, serving as the decisive dual-use technology. Every defense application has a direct commercial counterpart (RF communications for 5G/6G, power electronics for EVs and clean energy, photonics for AI data centers). This can be directly compared to technological advances brought about by defense in the past, such as commercial air travel and space exploration, which was sparked by defense technology during the Cold War.
DIS is contributing £250m to a UK-wide Defense Growth Agreement, built on local and national partnerships to develop sub-sector expertise while delivering sustainable regional growth. Collaboration with the South Wales Compound Semiconductor Cluster is felt to be synonymous with advancing both the security and growth objectives of DIS. Furthermore, at least 10% of the defense equipment procurement budget (£289bn by 2033) is expected to be spent on future technologies.
Directed energy weapons, autonomous systems and next-generation radars all rely on compound semiconductors, so the strategic case for a 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.
Building sovereign resilience within the UK
The South Wales Compound Semiconductor Cluster has extensive research, innovation and manufacturing capabilities in compound semiconductors. Cardiff University is known as the UK’s center of excellence for the development of cutting-edge gallium nitride-based integrated circuit technology (GaN-based IC technology) for RF communications, with supporting investment of £100m in a large-scale RF and photonic chip manufacturing facility at the Institute of Compound Semiconductors. Swansea University has invested more than £80m in new facilities to establish itself as a pilot for SiC and GaN power component technology in the UK’s Integrated Semiconductor Materials Centre. Both universities are working closely with the Center for Compound Semiconductors, a subsidiary of IQE, a pioneer in compound semiconductor materials, to source new compound semiconductor material solutions to support device research programs. The Compound Semiconductor Applications Catapult has comprehensive facilities for the design, testing, and module integration of new power, RF, and photonic component solutions.
This highly integrated innovation ecosystem feeds a large core industrial manufacturing base, providing the UK’s only fully integrated compound semiconductor supply chain from wafer growth to device manufacturing and packaging, with global companies such as IQE, Vishay, KLA and Microchip making Newport, Cardiff and Caldicott their UK manufacturing hubs.
A burgeoning small business community is also evolving to leverage research, development and innovation (RD&I) infrastructure, such as Microlink Devices, which manufactures dual-use compound semiconductor devices to service core or direct to aerospace and applications, and Space Forge, which develops space-based manufacturing solutions for ultra-high quality semiconductor materials. and Novomorphic, a semiconductor design company specializing in AI, defense, and aerospace.
Over the past decade, members of the Compound Semiconductor Cluster have worked together to build a coordinated, supportive regional ecosystem with sophisticated semiconductor talent and skills delivery programs, unparalleled RD&I infrastructure, and incentives to expand and upskill local supply chains. The cluster has grown to support 3,000 jobs over this period and is relentlessly focused on further growth with an ambition to support 6,000 jobs and £1 billion of industrial output by 2030. This established talent and infrastructure base, already identified on the DIS Regional Defense Cluster Map, is one of the few locations in the UK where defense-critical compound semiconductor requirements can be taken from specification to production-ready components within the same region.
These established strengths provide the basis for the Wales Defense Growth Agreement, signed at Cardiff Castle in February by Defense Secretary John Healy, Prime Minister Erned Morgan and Secretary of State for Wales Jo Stevens, which commits £50 million to position Wales as a major launchpad for autonomous defense technology in the UK. It pledges to expand access to MoD testing sites, including Aberporth, extend an air corridor across mid-Wales for unmanned air systems testing, and establish a new Defense Technology College of Excellence by September 2027. Importantly, this is a structural change that removes long-standing barriers that required small and medium-sized businesses in Wales to access secure defense contracts through prime contractors and opens the door directly for cluster companies to tackle MoD procurement at a scale not previously possible.
Leading the Wales Defense and Security Cluster
CSconnected is a steering group member of the Wales Defense and Security Cluster (WDSC), which was launched in Cardiff on 9 March 2026. Supported by the Ministry of Defense and the Defense Security Accelerator, and part of the UK-wide Regional Defense Cluster Network, the WDSC brings together government, industry, academia and small business with a single purpose: to accelerate innovation, strengthen supply chains and connect Welsh capabilities with national and international defense and security requirements. In the case of CSconnected, steering group membership is not a symbolic gesture. This is a strategic platform that will enable the Compound Semiconductor Cluster to work directly with defense prime contractors already operating in Wales: Thales, Airbus, Raytheon, General Dynamics, QinetiQ and Babcock. These are system integrators whose platform depends on the components that the cluster produces. For the first time, WDSC will create a structured forum to intentionally align its supply chain.
The scale of opportunity that WDSC reveals is staggering. Wales’ semiconductor production is around 500 million pounds a year, of which 90% is currently exported. This cluster is already produced in significant quantities and world-class quality. What is missing are the structured demand signals and supply chain coordination needed to direct the bulk of the gains to the UK’s sovereign defense requirements. The question is whether they will be given the resources and authority to do so at the pace their defense investment plans require.
Building sovereign capacity in South Wales
The compound semiconductor cluster will be the gateway for the UK to build world-leading sovereign capabilities to support the clean energy transition, defense resilience, AI infrastructure and advanced manufacturing base. Its Gateway is now open, operational and growing in South Wales.
The Wales Defense Growth Agreement has been signed. The Wales Defense and Security Cluster was launched on 9 March. The Defense Supply Chain Capability Program is ongoing. The policy architecture for linking the compound semiconductor cluster to Britain’s defense industrial ambitions has never been more complete.
What we need now is speed. Currently, 90% of Wales’ semiconductor production is exported and this sovereign opportunity is being realized elsewhere.
Government investment decisions regarding supply chain alignment, technology roadmaps, and procurement access must be made with the urgency required by the global semiconductor race and with the recognition that the assets needed to achieve the Defense Industrial Strategy’s most ambitious goals are already built, already proven, and ready to scale.
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