Four research and development centres will be set up by the Government, which will also subsume R&D works in five technology areas under the Applied Science & Technology Research Institute development plan.

Commissioner for Innovation & Technology Anthony Wong said the proposal, endorsed by the Steering Committee on Innovation & Technology yesterday, follows a public consultation exercise.

Mr Wong said under the new strategy, R&D centres for automotive parts and accessory systems, logistics and supply chain management enabling technologies, textile and clothing, and nanotechnology and advanced materials will be set up.

The institute will subsume R&D under the technology areas of communications technologies, consumer electronics, integrated circuit design, opto-electronics and Chinese medicine as part of its development plan.

Centres set up next year

The Government plans to invite proposals to host the R&D centres in January to February next year and to set up the centres in the second half of 2005.

"We hope that the centres will act as focal points for conducting applied research and development and provide platforms for commercialisation of applied deliverables," Mr Wong said.

The commission released a consultation paper on June 30 inviting comments on the 13 proposed technology focus areas for future development and the proposed R&D centres in the focus areas.

The commission has received 167 written submissions, including 15 from universities and R&D institutions, 50 from industry associations and professional organisations, 66 from companies and 36 from individuals.

Mr Wong said the vast majority of respondents agreed that Hong Kong should focus its resources on technology focus areas where it has a competitive edge, and the centres will help improve the relevance of applied R&D to the needs of industry and enhance co-ordination among institutions and the industry.

In line with the market-driven, demand-led approach of the new strategy, he said the first four centres to be set up are selected according to the criteria of existing research capability, competitive advantage, industry needs and market potential, industry commitment and support; and clearly defined objectives.

Car, logistics centres

On automotive parts and accessory systems, Mr Wong said taking into account the experience of the Productivity Council in the sector and the support it has been given by the industry, it will be invited to submit a proposal to host the centre.

To consolidate its role as a major logistics hub and supply chain management base, Mr Wong said Hong Kong should continue to develop the necessary knowledge base in enabling technologies of these two areas.

"In particular, radio frequency identification technology presents immense opportunities for revolutionising the industry by providing an unprecedented level of data collection and networking capability to solution providers," he said, adding publicly competitive bids will be invited for hosting this centre.

The Polytechnic University, with much experience in textile and clothing industry, has successfully completed many projects that have brought enormous benefits to the industry.

Supported by many organisations and companies in the sector, Mr Wong said the university will be invited to submit a proposal to host the centre.

Turning to nanotechnology and advanced materials technology, he said it offer a powerful enabling technology platform that could lead to a wide spectrum of innovative products.

The Institute of NanoMaterials & NanoTechnology at the University of Science & Technology, set up and supported by the Innovation & Technology Fund in 2002, has been making good progress in its R&D work.

Mr Wong said the Government will invite the university to expand the scope of the institute and to co-operate with other universities in becoming a centre for nanotechnology and advanced materials.

Five priority areas

Turning to communications technologies, consumer electronics, integrated circuit design and opto-electronics, he said the Applied Science & Technology Research Institute has identified them as its research priority areas in its new five-year plan.

Also, the institute's Jockey Club Institute of Chinese Medicine has been set up to promote R&D in Chinese medicine.

"The institute, well positioned to undertake research and development in these five technology areas under its existing operation infrastructure, will be invited to make a proposal on its plans to pursue R&D in these five focus areas," Mr Wong said.

Under the new strategic framework, the fund will adopt a new three-tiered funding model. Tier one will be for the research and development centres, to cover their initial operation cost and to sponsor individual projects undertaken by them.

The centres are expected to solicit industry commitment and participation in individual research projects through different modes of co-operation such as sponsorship, collaboration, contract research or forming consortia, Mr Wong said.

Tier two will be for focus themes of advanced manufacturing technologies, digital entertainment, display technologies and medical diagnostics and devices. Individual projects will be supported under the current Innovation and Technology Support Programme of the fund.

Tier three will be for innovative projects. Since new technologies with good market potential tend to be more forward-looking in nature and may not have immediate application, strong industry support may not be available at the start.

Biotechnology projects are good examples. Therefore, they will be more appropriately supported under the present 'bottom-up' approach by funding through the Innovation & Technology Support Programme, Mr Wong said.