Puerto Rico officials and agencies back study into local microchip R&D center

The House of Representatives’ Government Commission held a public hearing Sept. 10, 2025, on House Resolution 297 to study the viability of establishing a Puerto Rico center for research and development of integrated circuits (microchips) and related packaging.

The Negociado de Telecomunicaciones de Puerto Rico and the Department of Economic Development and Commerce (DIRECT) told the commission that Puerto Rico has assets — a skilled workforce, proximity to U.S. markets and universities, and existing manufacturing — that could support an R&D and advanced-packaging cluster, but that the island faces constraints in energy and water supplies that affect full-scale wafer fabrication.

"El negociado de telecomunicaciones de Puerto Rico apoya esta medida," said Osvaldo Soto García, president of the Negociado de Telecomunicaciones de Puerto Rico, adding that a local center could help validate prototypes and develop chips optimized for 5G networks. The commission’s presenters linked the proposal to growing global demand for data and to opportunities created by recent U.S. policy changes encouraging on‑shore semiconductor production.

Bianca Rivera Román of DIRECT said Puerto Rico already offers incentives and infrastructure that make the island attractive for parts of the semiconductor supply chain. Rivera Román described an existing 50% research-and-development tax credit under Puerto Rico’s incentives code and said the department is running outreach campaigns and trade visits to attract firms and partners. "Ese crédito... es un incentivo bien importante," she said.

José Castro, senior business development officer for aerospace and information technologies at DIRECT, urged the commission to focus on advanced packaging and testing rather than full wafer fabrication. "La parte de empaque realmente es donde están viendo los avances tecnológicos," Castro said, explaining that packaging and final testing consume far less water and energy than wafer manufacturing and are therefore more immediately viable on the island. Castro also described how a local R&D center could license intellectual property and train talent to plug into U.S. supply chains.

Officials and legislators discussed how the center could complement 5G, Internet of Things and edge-computing deployments: faster, denser and lower-latency networks increase demand for specialized chips and for nearby prototyping and validation. Osvaldo Soto noted that when 5G reaches higher frequencies and wider adoption, devices and networks will rely on many specialized chips and sensors.

Speakers recommended subsequent, targeted hearings with university researchers (the University of Puerto Rico’s Mayagüez campus submitted a written memorial and was cited as a future witness), local telecom operators and prospective packaging companies. DIRECT said it will provide preliminary economic-impact and employment estimates requested by the commission.

Constraints and next steps were emphasized: large-scale wafer fabs require high and reliable electricity and substantial water resources, challenges noted by panelists; advanced packaging and testing require clean-room space and specialized equipment but are less resource‑intensive. Panelists and legislators discussed using existing industrial space in Mayagüez, partnerships with universities, and tapping federal CHIPS program funding and private investment. Rivera Román and Castro said they were conducting outreach to potential partners and attending industry events such as Semicon 2025.

The hearing closed with the commission planning follow-up hearings to hear the University of Puerto Rico, telecom operators and interested packaging companies and to receive the economic-impact data DIRECT said it would supply to the committee.