Announcing this on Thursday, Malaysian Prime Minister Mahathir Muhammad said the microchip would boost the global “anti-terror” war.
Mahathir said the revolutionary miniature chip, developed by Japan's FEC Inc., could be combined with current technology to "greatly prevent the possibilities of terrorist acts" as well as banknote and document counterfeiting.
FEC (M) Sdn. Bhd. chief executive Kunioki Ichioka told reporters that the chip can also be inserted into the human body, animals, bullets, credit cards and other items for verification purposes, and can replace price bar codes used to tag products.
Measuring 0.5 of a square mm and produced at less than 0.38 ringgit (10 cents) each, the chip - the size of a dot - uses the radio frequency identification (RFID) chip technology.
"The application is almost unlimited," Mahathir told a news conference after annual talks with global hi-tech chiefs at Cyberjaya town in Malaysia's Multimedia Super Corridor MSC), an enclave south of the capital Kuala Lumpur modelled after California's Silicon Valley.
"We think this is a great breakthrough for Malaysia. It is the first in the world. No other people have come up with such a tiny microchip, particularly as it also has a built-in antenna," he said.
The veteran premier declined to reveal the cost for the project, dubbed MM or Malaysian Microchip. "I think it is reasonably priced," he said, adding in jest that the acronym MM did not stand for Mahathir Muhammad.
"We think this is a great breakthrough for Malaysia. It is the first in the world"
Mahathir Muhammad, Prime Minister, Malaysia
Mahathir said the project, in which Malaysia would establish the chip applications and network, would spur new economic initiatives and accelerate the country's goal of becoming a developed nation by 2020.
He said the chip would initially be manufactured in Japan early next year but production would eventually be shifted to a factory in Malaysia's northern Kedah state belonging to state-owned wafer fabrication firm Silterra (M) Sdn. Bhd.
He said Japanese companies would still be involved in the project, in the transfer of technological know-how, but the proprietary right would belong to Malaysia.
The project is seen as another feather in the cap for the 77-year-old Mahathir before his retirement in October after 22 years in power.