Experts lay out steps Hong Kong can take to leap ahead in global chip race

Government to open Microelectronics Research and Development Institute next year as part of transforming city into innovation hub, according to finance chief’s budget

While Hong Kong will face stiff competition in semiconductor manufacturing, success is possible if authorities carefully target specific areas, experts say

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Hong Kong’s semiconductor plans will need to contend with Western curbs on mainland China’s acquisition of chip technology, experts say. Photo: Shutterstock

Published: 2:00pm, 26 Feb 2023Updated: 4:11pm, 26 Feb 2023

Hong Kong should aim to develop breakthroughs in semiconductor materials and chip packaging technology by attracting talent and enterprises if it wants to be a regional leader in microelectronics, experts have said.

But the process would not be easy, they warned, noting the city would need to commit to investing a significant amount of money for many years and overcome the hurdles of securing Western chip equipment given the United States’ curbs on China’s acquisition of the technology.

In his budget on Wednesday, Financial Secretary Paul Chan Mo-po raised eyebrows when he announced plans to set up the Microelectronics Research and Development Institute in the Yuen Long InnoPark next year. He expected the institute to become a “leading organisation for supporting microelectronics development in the Asia-Pacific region”.

One area Hong Kong should focus its semiconductor ambitions on is the development of an alternative to silicon, Chinese University’s Professor William Wong has said. Photo: Getty Images

Developing the microelectronics industry is part of the government’s wider plan to transform the city into an international innovation and technology (I&T) hub as envisioned by Beijing.

A government source said the microelectronics institute aimed to develop the local production of chips and semiconductors for the manufacture of electric cars.

The insider added the institute would explore every opportunity in building all kinds of chips and semiconductors but the main focus would be on integrated circuit packaging and third-generation semiconductors for electric cars.

Professor William Wong Kam-fai, the associate dean at Chinese University’s faculty of engineering, said Hong Kong needed to develop its own cutting-edge technology in the areas of semiconductor materials and integrated circuit packaging if it wanted to succeed in the global chip race.

“If Hong Kong can develop a new semiconductor material to replace silicon, it will create a different kind of technology for the production of chips, from design, fabrication to packaging,” he said. “This is one of the ways to achieve breakthroughs in semiconductor technology and stay ahead of the game.”