SoftBank, the company's owner, refused the Prime Minister and Chancellor's pleas for a joint listing in London.
The UK government's recent approach to semiconductors has raised doubts about its cluelessness in semiconductor policy.
With Arm's decision and the jumbled impression of the government's economic strategy, the UK's global tech powerhouse status is at risk of becoming a lame duck.
Arm, the jewel in the crown of the UK tech industry, has dealt a major blow to Downing Street and the government's promise to turn the UK into a new Silicon Valley. Despite efforts from the Prime Minister and Chancellor to persuade Arm's owner, SoftBank, to seek a joint listing in London, the company has decided to list its shares only in the US.
The government has been promising to turn the UK into a global tech powerhouse, with Arm being its strongest card. However, this decision by SoftBank has left the government devastated, and questions have been raised about the government's recent approach to semiconductors.
The government's semiconductor strategy document has been eagerly awaited, but there are doubts whether it will ever arrive. Its decision to allow a Chinese-backed takeover of the UK's biggest semiconductor manufacturer, Newport Wafer Fab, only to reverse it the following year, has left some wondering if the government is clueless about its semiconductor policy.
In addition, there are questions about the UK's economic strategy, including its response to the US inflation reduction act, one of the biggest industrial strategy policies in the world for decades. The government's policy on the steel sector also appears confusing, with signals sent to steelmakers to shift towards greener alternatives while approving a new coal mine in Cumbria.
While the government has taken a more constructive stance on Brexit, the impression is not of a coherent plan, but a jumble. Some have warned that the government's focus on questionable new technology like cryptocurrency and stripping back post-financial crisis rules for banks may not be the best strategy.
In conclusion, Arm's decision to list its shares only in the US may not be solely due to the government's policy, but it is unlikely to have helped. The government needs to provide a coherent plan for the UK's economic approach to reassure investors and businesses alike.