Funding of nearly £38m has been announced for a facility to make compound semiconductors – a new technology behind robotics, 5G and driverless cars.
The 10 councils in the Cardiff Capital Region are set to develop the foundry in Newport, which could create about 2,000 high skilled jobs in five years.
The funding follows £12m from the Welsh Government in November 2015.
First Minister Carwyn Jones said it would boost Wales’ global reputation.
The facility will cost £8m to refurbish and £30m to kit out with all the technology required. It will be owned by the councils and is projected to create £375m of private sector investment in the next five years.
These will be highly skilled and highly paid jobs, with the going rate expected to be around £65,000 a year.