Hong Kong's electronics sector is heading for a renaissance, as the city encourages development of a competitive semiconductor design industry. That is the forecast of Hong Kong Science and Technology Parks Corp (HKSTP) chief executive Tam Chung-ding, who is spearheading the industry initiative from the government-backed chip-design site in Sha Tin. The HKSTP last week inaugurated a chip-design centre at the Hong Kong Science Park in Sha Tin. The IC Design Centre intends to attract both local and overseas firms to do chip research and development. 'This development will have a huge economic impact for Hong Kong since we would control the core technology behind electronics products, the integrated circuit [IC],' Mr Tam said. Most of Hong Kong's electronics manufacturing has moved to low-cost production areas in the mainland, where factories - a good number of them funded by Hong Kong firms - churn out chip-filled electronics goods from computers, and mobile phones to microwave ovens and toys. Mr Tam said Hong Kong needed to cultivate the necessary skills and build key infrastructure to support an IC design industry that 'would not reinvent the wheel', but 'simply adopt existing semiconductor product road maps'. That would enable Hong Kong's electronics sector to get more deeply involved with product innovation and be part of the supply chain that delivered integrated circuits required by manufacturers, Mr Tam said. The Hong Kong Electronic Industries Association has estimated that IC demand from electronics manufacturers along the Pearl River Delta reached US$4.5 billion in 2000 when total product output in the area was estimated at about US$84 billion. The association found that Hong Kong's fledgling IC design sector generated just 7 per cent of the total IC demand in the area during that period. Mr Tam said a thriving local semiconductor design market could raise the amount of electronics products exported by Hong Kong to about US$1.2 billion. Data from the Census and Statistics Department shows that electronics exports from Hong Kong reached HK$538 billion in 2001. Mr Tam said the local electronics sector's avowed goal was to increase by fivefold the number of IC design houses in Hong Kong from 20 at present. This scenario would create up to 10,000 new jobs. Dorothy Lai, principal semiconductor analyst at research firm Gartner, said that 'developing a competitive IC design industry in Hong Kong appears to be a viable undertaking' since most information technology and electronics manufacturing operations had moved to low-cost sites in Asia. Mr Tam said he felt strongly about Hong Kong's chip-design initiative. His 33-year career at Motorola included leading the local development of the Dragonball processor used in PDAs running the Palm operating system. He said: 'The team that designed the Dragonball chip was all local, including myelf.' After joining Motorola in 1968, Mr Tam steadily moved up the ranks to lead the United States-based company's semiconductor products business group in Asia as its general manager. He established this unit's headquarters in Hong Kong, which included IC design and manufacturing. He was also instrumental in setting up Motorola's semiconductor production plant in Tianjin. After retiring from Motorola, Mr Tam last year agreed to head the HKSTP and lead Hong Kong's belated entry in the pan-Asian race to build a regional science and technology hub. Up to 20 more chip firms are expected to join multimedia IC specialist RedRock Semiconductor of Silicon Valley and local firm Dragonchip at the science park this year. Mr Tam said the government had raised the ante for the semiconductor design drive with HK$58 million in funding to build an IC development support facility at the Science Park, which will complement the existing design centre.