How Hong Kong can establish itself as an international technology center?
1.Scientific research ability and capability of technology transfer
Hong Kong has six universities with research ability, of which the University of Hong Kong, Hong Kong University of Science and Technology, and The Chinese University of Hong Kong are listed as Top 100 universities in the world. Massachusetts Institute of Technology set up its first overseas innovation center in Hong Kong, the University of Chicago also opened a branch school here and even Chinese Academy of Sciences’ Guangzhou Institutes of Biomedicine and Health chose Hong Kong for its Stem Cell Center.
DJI, an enterprise worth of US$15 billion, is in close relation with Hong Kong University of Science and Technology (HKUST). Wang Tao, Founder of DJI, was an undergraduate at HKUST in 2005 and he decided to use flight control system of remote-controlled helicopter as his research topic. Partly he wanted to make his childhood dream come true – to create a helicopter which can stay still in the air and to control where to stop it wherever you want. After rounds of trial and error for almost a year, Professor Li Zexiang from Department of Electronic and Computer Engineering, HKUST recommended Wang to pursue a master degree. He finally made his first prototype in January 2006. Wang, at the same time, successfully raised a fund of HK$2 million and founded DJI in Shenzhen. The mother company remains in Hong Kong and enjoys the abundant talent and low tax system here.
Wang faced a very difficult time at the beginning, but Professor Li brought in capital as well as assistance from his other students. DJI then launched its XP3.1 helicopter flight control system.
As a professor at HKUST, Li is always involved in the startup incubating work. Other than DJI, his other students set up the robotics company, Quotient Kinetic Machine as well as ePropulsion Innovation which invented an electric outboard motor. Professor Li Zexiang himself also set up a robotic base at Songshan Lake in Dongguan.
Professor Li commented that Hong Kong and Pearl River Delta (PRD) should be treated as a single entity. PRD has developed the most comprehensive manufacturing base, thanks to the long history of being the OEM base for many of the world’ leading brands. The lead time for parts purchasing and mould production is three to even 10 times faster than their counterparts in the U.S. and Europe. “You talk to the craftsman in the evening and will be able to get the stuff the next day,” said Li.
Tang Xiaoou, Co-founder of SenseTime, the unicorn of the AI industry, is now a professor at the of Information Engineering, The Chinese University of Hong Kong, and also the associate dean at the Shenzhen Institutes of Advanced Technology, Chinese Academy of Sciences. Tang is the icon responsible for successfully transferring technology into actual application as well as a pioneer of facial recognition technology.
Various industries in Hong Kong are raising their support towards technological advancement. For example, at the HKUST Fok Ying Tung Research Institute, there will be funding of up to 2 million yuan per project available if it passes the application criteria. In other words, from the setting of a new company to launching IPO, if the project can successfully apply for funding, they can get subsidies of up to 100 million yuan.
At her policy address, Carrie Lam indicated that she will personally lead a high-level, inter-departmental Steering Committee on Innovation and Technology, with a goal to double the Gross Domestic Expenditure on R&D as a percentage of the Gross Domestic Product from the current 0.73 percent to 1.5 percent within the current-term Government’s five-year tenure. This equals to an annual expenditure of HK$45 billion. To encourage research and R&D investment by enterprises, the HKSAR government proposes that the first $2 million of eligible R&D expenditures will enjoy a 300 percent tax deduction with the remainder at 200 percent. It also sets aside no less than $10 billion for university research funding. The Innovation and Technology Bureau will also launch a $500 million “Technology Talent Scheme”. The Education Bureau will make available $3 billion to provide studentships for local students admitted to University Grants Committee-funded research postgraduate programmes.
2.The second advantage is the leading position as a sourcing hub for overseas buyers looking for China products.
International buyers can visit trade shows in the morning and once they find the right products, they can go for a factory visit in Shenzhen and other PRD cities in the afternoon. As the Great Bay Area will soon develop as a metropolitan region, convenient transportation in Hong Kong will be a very prominent edge. In fact, the HKSAR government and Shenzhen are planning to jointly develop an innovation and technology park at Lok Ma Chau Loop which aims to become an international innovation and technology center for the Great Bay Area.
All kinds of international trade shows are frequently held in Hong Kong every year. This also provides great convenience for China startups looking to network with international companions and helps them tap into the international markets. At the same time, international investment funds can also find ways to enter China markets as many international startups prefer to set up headquarters in Hong Kong.
One of the leading technology shows in Hong Kong is the Global Sources Electronics show. It is the world’s largest electronics sourcing event held every April and October at Hong Kong’s AsiaWorld-Expo. The show consists of two phases, Consumer Electronics show and Mobile Electronics show.
Consumer Electronics runs from April 11 to 14 and features 3,800 booths exhibiting the latest home, outdoor and auto electronics, plus gaming, smart living, components, commercial electronics, computers and accessories. It also includes a special product launch area, and a product gallery along with experience and demo zones to highlight innovative products and technologies. Mobile Electronics is scheduled to take place from April 18 to 21, focusing on the latest mobile devices and accessories, speakers and headphones, VR/AR and wearables.
In recent years, Global Sources Electronics show launched the Startup Launchpad which is Asia’s largest hardware trade show that facilitates global distribution between startups and renowned online and offline retailers. This April, there are 200 startups from 14 countries and regions showcase new innovations covering IoT, wearables, smart home, robotics, VR/AR and other high-growth categories.
With the collaboration from government, industry players and tertiary institutions, and more in-depth integration between Hong Kong and PRD, the trade show platform can attract more global startups to base in Hong Kong, thus facilitate a better cooperation with China. The hope of developing a “Technology Hong Kong” might come true very soon.
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