Hong Kong Business News

Delivering his 2024 Policy Address, Chief Executive John Lee said today that Hong Kong must harness new quality productive forces and technological innovation as it seeks to achieve high-quality economic development.

Mr Lee outlined that in its efforts to become an international centre for innovation and technology (I&T), the city is upgrading and transforming traditional industries, while actively nurturing emerging ones. He vowed that no effort will be spared in developing new quality productive forces tailored to local conditions. 

Measures announced in Mr Lee’s speech include the drawing up of a development plan for new industrialisation, the setting up of a third InnoHK research cluster, a new round of $1.5 billion in funding under the Research Matching Grant Scheme, a revamping of the Government’s approach to I&T investment, and the launch of an I&T Accelerator Pilot Scheme.

Besides drawing up a medium to long‑term development plan for new industrialisation, Mr Lee said the Government will also press ahead with the establishment of the Hong Kong New Industrialisation Development Alliance. He explained that this will promote closer collaboration among the Government, industry, academia, and the research and investment sectors, expand financing opportunities, and foster I&T co‑operation between newly‑listed companies and local universities.

In terms of research and development (R&D), Mr Lee highlighted that preparatory work is underway to establish a third InnoHK research cluster. He mentioned that the existing two such clusters are now home to about 2,500 R&D personnel from Hong Kong and around the world, and iterated that the new cluster will focus on advanced manufacturing, materials, energy and sustainable development. 

In addition to the new round of funding under the Research Matching Grant Scheme, which encourages organisations to support research endeavours by institutions, Mr Lee pledged that the Government will increase its own investment in I&T industries and guide more market capital to invest in the sector. This will include setting up a $10 billion I&T Industry‑Oriented Fund, a “fund of funds” that will channel market capital to invest in emerging industries of strategic importance, including life and health technology, AI and robotics, semi‑conductors and smart devices, advanced materials, and new energy.

The Chief Executive added that $1.5 billion from the Innovation and Technology Venture Fund will be redeployed to set up funds that will invest – jointly with the market, on a matching basis – in start‑ups operating in strategic industries. Meanwhile, the Hong Kong Investment Corporation will continue to channel and leverage market capital to attract I&T enterprises to establish operations in Hong Kong.

Announcing plans to allocate $180 million to establish an I&T Accelerator Pilot Scheme, Mr Lee said it will offer institutions government funding on a one-to-two matching basis, with a subsidy ceiling of $30 million. He explained that the scheme will attract professional start‑up service providers to set up accelerator bases in Hong Kong, thereby fostering the robust growth of start‑ups.

Mr Lee also outlined plans to unlock the potential of Hong Kong’s low-altitude airspace economy. A working group led by the Deputy Financial Secretary will be established to formulate development strategies and action plans for this issue, and will collaborate with Mainland authorities in exploring the joint establishment of low‑altitude cross‑boundary air routes, as well as immigration and customs clearance arrangements. It will also carry out studies and make plans for the establishment of effective systems, networks and infrastructure for managing low-altitude activities.

With regard to Low Earth Orbit satellites, Mr Lee announced that the Government will conduct a study aimed at streamlining vetting procedures in relation to licence applications for their operation. He also revealed that the Government will set up a research centre to participate in the Chang’E‑8 lunar mission.

In relation to new energy development, around $750 million under the New Energy Transport Fund will be earmarked to subsidise the taxi trade and franchised bus companies to purchase electric vehicles, and to launch the Subsidy Scheme for Trials of Hydrogen Fuel Cell Electric Heavy Vehicles.

Mr Lee added that the Government will speed up the reduction of carbon emissions by setting a target for sustainable aviation fuel (SAF) consumption, and formulate a long-term plan for the development of SAF and green maritime fuel supply chains. Furthermore, it will support industry in establishing a solar-to-hydrogen demonstration facility, and introduce a bill next year to ensure the safe use of hydrogen fuel. 

---

PREVIOUSNEXT