Hong Kong is relying on its reputation for protecting intellectual property rights (IPR) to challenge Shanghai as the semiconductor design centre of Greater China.
The number of chip design companies at the Hong Kong Science and Technology Park has grown to 30 from just three in June last year, employing about 1,500 staff. Many choose the city for its proximity to Chinese electronics manufacturers and Hong Kong's status as a logistics and financial services centre.
A key selling point, however, has been Hong Kong's strong legal structure to protect intellectual property, which is sometimes woefully lacking on the mainland.
There are about 45 semiconductor design companies in Shanghai, and about 460 throughout the mainland, although many have fewer than five staff and less than US$120,000 in capital, according to a recent report from iSuppli.
The Hong Kong government has been strongly criticised for wasting public money on a US$40 million project to build a domestic chip design industry - a programme sceptics argue is doomed to fail as companies bypass the city to go directly into China.
'My worry is not that China can pick up fast and catch up to us; my worry is whether Hong Kong can maintain its high standard of integrity,' said park vice-president of business development and technology support S.W. Cheung.
