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A research institute owned by Shanghai Jiao Tong University yesterday announced the completion of its second and third generation of chips for use in mobile phones, digital cameras and personal digital assistants.

The university's IC and Systems Research Center became a major player in the city's chip design industry last February, when it introduced its HISYS-I, its first-generation digital signal processor.

The processors, or DSPs as they are commonly called, act as the central processing units for consumer electronics, coding and decoding digital signals.

The two new chips, HISYS-II and III, are based on the center's original DSP, but are much faster, according to Chen Jin, a returned overseas student who leads a team of some 100 engineers and experts at the research center.

HISYS-II can process 150 million calculations per second while the HISYS-III can do 600 million per second.

"The two new chips further reflect the development of Shanghai's semiconductor industry," said Zhang Ao, deputy director of Shanghai Science and Technology Committee.

To date, the research center has received orders from abroad for 1.5 million of its HISYS-I chips and 2 million of its HISYS-II.

It is currently working on two more advanced versions of the chips, which are powerful enough to run computers as well as smaller gadgets.

Chen admits Shanghai still lags behind some developed countries in designing and manufacturing chips.

He says even the HISYS-III is two to three years behind developed countries, while China's manufacturing technology is five to 10 years behind.

Hu Zhe, a semiconductor analyst with Haitong Securities Co Ltd, said China's strength is in designing chips, which is the most profitable part of the integrated circuit industry.

"It is safer for the Chinese government and local companies to invest in chip design instead of manufacturing plants, as they have to dump billions of dollars into chipmaking equipment," Hu said.

China's chip market is developing rapidly, with demand growing by about 20 percent annually. The country imported more than 15 billion yuan (US$1.8 billion) worth of chips last year, as domestic manufacturers couldn't meet demand for high-end products.

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