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GBA status as tech hub may push demand for semiconductors

Hong Kong’s chip design capabilities will likely be in high demand as the Greater Bay Area further develops smart infrastructure and as the city positions itself as a hub for innovation and technology.

The bay area plan, which consists of nine southern mainland Chinese cities as well as Hong Kong and Macau, can possibly unlock a huge potential for third-generation semiconductors that can be used for electric vehicles, 5G technology, and smart manufacturing and transport, according to the Senior Director of Integrated Circuits and Systems at ASTRI noted.

No other place on earth resembles Hong Kong, where so many big companies exist in such a small region, and with such huge potential demand for third-generation semiconductors.

Third-generation semiconductors – which are gallium nitride and silicon carbide-based devices with higher voltage and temperature resistance than traditional silicon-based materials – is a major focus area for ASTRI, which has around 150 engineers working on chips.

Interest from the global tech community in Hong Kong is on the rise and more than five mainland-based companies have set up branches that involve integrated circuit R&D in Hong Kong in the past couple of years. This has been attributed to the growing interest to Beijing’s plan to develop the GBA and to the Hong Kong government’s continued investment in technology R&D, including semiconductors.

The Greater Bay Area touted as China’s answer to Silicon Valley, encompasses 65 million people and is home to some of China’s biggest technology companies.

To take a greater role in the bay area scheme’s development, Hong Kong wants to strengthen its R&D capabilities, enabling local institutes to enjoy the same level of the funding offered to mainland entities.

ASTRI, the largest government-funded R&D centre in Hong Kong, is one of the research institutes covered by the government’s drive. Established in 2000, the institute works with companies and start-ups globally to develop technologies applicable to their businesses.

The centre’s clients will need to set up a Hong Kong-based entity as the organization aims to bring R&D capabilities to the city.

In the semiconductor sector, the institute is a leader in the development of narrowband internet of things (NB-IoT) chips, which support a wide range of applications in smart cities and consumer electronics, and the technology has been licensed to companies in mainland China, Europe, and Israel.

The institute has set up a branch of the National Engineering Research Center for Application Specific Integrated Circuit Systems, a leading chip design centre, which allows ASTRI’s IC partners to apply for national funding from China.

The local IC industry is attempting to tap an area that major mainland companies are looking into as a potential source of replacement parts for the foreseeable future. However, the opportunities are “two-sided” as uncertainty looms.

ASTRI is also looking to boost its own indigenous IC research in the long run to reduce reliance on imported technology. Their strategy is to start with very fundamental stuff from the ground up; building their own innovation culture, and then developing their own new technology.

Collaboration is the GBA’s competitive advantage

According to an earlier report, Beijing’s Outline Development Plan for the Guangdong-Hong Kong-Macao Greater Bay Area, published early this year, lays out a vision for a vast technology, finance, manufacturing and logistics hub built on a network of nine major cities in Guangdong, plus Hong Kong and Macau.

The ambitious schedule set by the Outline Development Plan (ODP) states that the ‘framework’ of the Greater Bay Area (GBA) should be in place by 2022 and that the GBA should have become an effective economic system supported by innovation by 2035.

The Principal Liaison Officer for the Hong Kong, Shenzhen Qianhai Authority, stated that while the GBA project will be market-driven, collaboration rather than ‘malign competition’ between the eleven cities is key to the project’s success.

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