Hong Kong News

Innovation & Technology

Recognizing that Innovation and Technology is an important growth engine for future economic development, the Government is also supporting a series of measures in this aspect, including the exploration of the development of a third InnoHK research cluster.

The Financial Secretary has also earmarked US$385 million (HK$3 billion) to take forward Phase 2 of the Hong Kong Science Park Expansion Programme and injected US$256 million (HK$2 billion) into the Innovation and Technology Fund to provide matching-basis support for manufacturers setting up smart production lines. The Government will continue to provide enhanced tax deduction for qualifying R&D expenditures and proposed a US$25.6 million (HK$200 million) Green Tech Fund to support the R&D and application of decarbonization and green technologies.

International Financial Center


The Financial Secretary also set out a series of proposals to fortify the city’s competitiveness as an international financial center. Over the next five years, the Government will issue green bonds totaling US$8.5 billion (HK$66 billion). We will also continue to issue inflation-linked retail bonds and Silver Bonds, totaling at least US$1.6 billion (HK$13 billion). To encourage the development of private equity funds in Hong Kong, tax concessions for carried interest issued by private equity funds will be provided.

Economy/Special Relief Measures


Adopting an expansionary fiscal stance, Hong Kong’s Financial Secretary Paul Chan announced a wide range of measures on February 26, 2020 to stimulate the economy and to tackle the current economic challenges by making optimal use of the fiscal reserves in his 2020-21 Budget.


Hong Kong’s economy contracted by 1.2% in 2019, and the full-year growth for 2020 is forecast to be between -1.5% and 0.5%. In the medium term, Hong Kong’s economy will grow by an average of 2.8% per annum in real terms from 2021 to 2024.


The sound fiscal reserves of about US$141 billion (HK$1,100 billion) allow the Government to implement counter-cyclical measures to help support enterprises and smoothen livelihoods. These measures include a one-time cash payout of US$1,282 (HKS10,000) to Hong Kong permanent residents, concessionary low-interest loan for small and medium enterprises and reductions in salaries and profits tax.

Opportunities for tech enterprises













Secretary for Innovation and Technology Nicholas W Yang, spoke on the opportunities presented by Hong Kong’s participation in developing the Guangdong-Hong Kong-Macao Greater Bay Area (GBA) into an international innovation and technology (I&T) hub at a leadership luncheon held in San Francisco (Sep 18) on “Bay-to-Bay” connection and Hong Kong’s technology development. He encouraged US technology enterprises to leverage on the opportunities brought about by the GBA development to achieve a win-win outcome. During his stay in San Francisco (Sep 17-18), Mr Yang visited the Google campus and discussed with its senior management Google Hong Kong’s Smarter Digital City 3.0 white paper. He also paid a visit to Johnson & Johnson (J&J) Innovation’s JLABS to learn more about its incubation program in accelerating healthcare innovation.Mr Yang encouraged J&J to strengthen collaboration with universities in Hong Kong and take part in the Health@InnoHK initiative focusing on healthcare technologies.


Source: Hong Kong Economic and Trade Office, New York.

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Hong Kong’s unique status and strengths highlighted











Secretary for Commerce and Economic Development Edward Yau highlighted Hong Kong’s unique status and strengths which make it the best partner in Asia for US businesses to expand operations, build networks, meet great people and explore collaboration with different communities. Speaking at the “Think Asia, Think Hong Kong” Gala Dinner in Los Angeles (Sep 19), Mr Yau said the city’s advanced financial services industry and infrastructure, a unique separate customs territory status and trade autonomy conferred upon Hong Kong by the Basic Law, under the framework of “one country, two systems”. The US was Hong Kong’s second largest trading partner and market for exports in 2018, with bilateral merchandise trade amounting to US$75 billion. Hong Kong and the US enjoy mutually beneficial and expanding strong trade connections. The US consistently has the highest trade surplus with Hong Kong, at US$33.8 billion in 2018, and an aggregate merchandise trade surplus with Hong Kong amounting to US$297 billion from 2009 to 2018. Bilateral ties extend beyond trade and economic relations to encompass people-to-people contacts, educational exchanges, sports and cultural events, innovation and technology development and government-to-government co-operation.


Source: Hong Kong Economic and Trade Office, New York.

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August retail sales fall 23%

The value of total retail sales in August, provisionally estimated at US$3.7 billion, fell 23% year-on-year. The plunge reflected the weak consumer sentiment amid subdued economic conditions, and the severe disruptions to inbound tourism and consumption-related activities caused by the local social incidents.The Government said retail sales had registered the steepest year-on-year decline for a single month on record, even worse than that recorded in September 1998 during the Asian Financial Crisis. The Government will closely monitor the situation and the implications for the labor market and the economy.


Source: Hong Kong Economic and Trade Office, New York.

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Policy objectives to restore calm and boost economy




















Hong Kong Chief Executive Carrie Lam set out core principles and strategies for overcoming the social and economic challenges facing Hong Kong in her Policy Address (Oct 16), themed “Treasure Hong Kong: Our Home”. The principles for handling the current crisis and discharging governance responsibilities included adhering to the “one country, two systems” principle; safeguarding the rights and freedoms protected by the Basic Law; upholding the rule of law, which is a core value of paramount importance to Hong Kong; and protecting the city’s institutional strengths. She also unveiled more than 220 new initiatives that aimed at helping local businesses overcome hurdles during the economic downturn and that targeted the unresolved disputes and ongoing violence with a view to restoring social calm and embarking on the road to reconciliation.


Source: Hong Kong Economic and Trade Office, New York.

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Financial markets operating normally

The Hong Kong Monetary Authority (HKMA) reiterated (Oct 10) that the invocation of the Emergency Regulations Ordinance does not affect the normal operation of Hong Kong’s banking sector or financial markets. Banking services are largely normal, except for service disruptions caused by vandalized branches and ATMs where immediate and full restoration of services was not possible. The city’s banking system is very robust and sound, with average capital adequacy ratio of 20%. The Hong Kong Dollar exchange rate has remained stable throughout the recent social disruptions. The HKMA and the HKSAR Government have an unwavering commitment and ample resources to defend the Linked Exchange Rate System when needed.


Source: Hong Kong Economic and Trade Office, New York.

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Progress in Hong Kong – Shenzhen cooperation

Substantial progress has been made on various fronts in cooperation between Hong Kong and Shenzhen, said Chief Secretary Matthew Cheung (Apr 2). Both places will continue to deepen cooperation through participation in the development of the Guangdong-Hong Kong-Macao Greater Bay Area. He cited the development of Hong-Kong Shenzhen Innovation and Technology Park in Lok Ma Chau as an example of close partnership for a world-class I&T hub in the Greater Bay Area. The first batch of land parcels is expected to be made available by 2021 or earlier for construction.



Source: Hong Kong Economic & Trade Office

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