Mainland state-owned Shougang Concord Technology Holdings and United States-based Artech have chosen Hong Kong as the site for a US$80 million semiconductor venture. The decision is a boost for Hong Kong's attempts to position itself as a investment destination for high-technology industry. Shougang Concord chose the SAR ahead of rivals Shanghai and Shenzhen, which have offered incentives such as tax concessions to attract hi-tech investment. 'Hong Kong is an international finance and information centre. With a production base in the SAR, the new venture will be well positioned [for] the mainland, Taiwan and the US markets,' said Luo Bingsheng, chairman of Shougang Concord's parent, Shougang Group. 'It is easier to attract talent and hi-tech experts in Hong Kong.' The partners also looked at Beijing, before deciding Hong Kong offered the best investment environment of the four cities. Mr Luo was speaking after Beijing-based Shougang Concord and Artech signed a memorandum of understanding on the proposed joint venture to manufacture and design photomasks, high-precision quartz plates containing microscopic images of electronic circuits which are a key element in the production of microchips. Secretary for Commerce, Industry and Technology Henry Tang Ying-yen, who attended yesterday's signing ceremony, welcomed the decision. He declined to say whether the project would receive any incentives. The government had yet to fix any policy on incentives to attract foreign investment but the Innovation and Technology Fund existed to support any hi-tech funds investing in Hong Kong, he said. The Innovation and Technology Commission said it had not received any funding application from Shougang or Artech. In November 2000, US-based Hambrecht & Quist Asia Pacific opted to set up a HK$9.2 billion chip-making plant in Shanghai after the government declined to provide land and tax concessions. There is speculation the Shougang-Artech venture will be based in Tseung Kwan O, although Mr Luo said the location had not yet been decided. Mr Luo said total investment in phase one of the development was about US$80 million. Shougang would invest US$30 million. The Chinese company will hold 47 per cent of the proposed venture, called Profit Sky, with the remaining 53 per cent held by Artech.