Hong Kong's growing investments in R&D

26 January 2015 Author: Claudio Murri, Asia Advisor to EIF

The Hong Kong Chief Executive (the head of the Government of the Special Administrative Region of Hong Kong), Mr. Leung Chun-ying, delivered his annual address – commonly referred to as “Policy Address”  to the Legislative Council.

Most media understandably focused exclusively on the political issues related to universal suffrage and the role of the Chinese central government in Hong Kong. However, Mr. Leung’s address contained a series of references to government plans in the areas of innovation and technology, aimed at retaining the role of Hong Kong as one of the leading information technology hubs in Asia Pacific. 

Mr. Leung emphasized the importance of innovation for Hong Kong, stating that the region’s gross domestic expenditure on R&D increased from $7.1 billion in 2001 to $15.6 billion in 2013, an average annual growth of 7%, while the number of R&D personnel has more than doubled during the same period. 

To ensure that Hong Kong maintains its present competitiveness, the Chief Executive proposed injecting the equivalent of an additional 500 million euros into the Innovation and Technology Fund, a scheme that has proven successful in helping start-ups establish and flourish. The ITF received $5 billion in 1999 when it was launched and the distribution of those resources was spread over 15 years. Additionally, the government plans to create other specific programs such as the Enterprise Support Scheme (ESS), the Technology Start-up Support Scheme for Universities (TSSSU), and a 30 million euro Youth Development Fund for NGOs to assist young people to launch their business with subsidy in the form of matching funds. 

On technology infrastructure, the Chief Executive mentioned plans to continue to invest in the Science Park which will accommodate more than 600 partner companies in 2016 (up from around 500 at present) . He also proposed to use the area of the former Hong Kong airport in Kowloon East for a brand new smart city project.

Finally, the government proposed to renew and enrich the curricula and learning activities of Science, Technology and Mathematics, and enhance the training of teachers, in an effort to ensure that the new generations continue to possess critical skills to succeed in the economy of the future.

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