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Following is a question by the Hon Sin Chung Kai and a written reply by the Secretary for Commerce, Industry and Technology, Mr John Tsang, in the Legislative Council today (February 2):

Question:

Regarding the measures to support the development of the software industry in Hong Kong, will the Government inform this Council:

(a) as The Government Procurement Law of the People's Republic of China provides that, except for specific circumstances, governmental bodies in the Mainland should purchase our own country's goods and services, but the software produced in Hong Kong does not fall within the scope of the above goods and services, whether the Hong Kong authorities will, in the discussions on the third phase of the Mainland and Hong Kong Closer Economic Partnership Arrangement beginning early this year, strive for the inclusion of the software produced by software developers in Hong Kong in the above scope or for the enjoyment of zero tariff treatment by such software;

(b) given that the Mainland Government has been actively promoting the applications and development of open source software in recent years, whether the Hong Kong authorities will take corresponding measures, allocate resources to encourage the software industry in Hong Kong to develop the above software and strengthen the related manpower training; if it will, of the details; if not, the reasons for that; and

(c) in order to strengthen the partnership relationship between the software industries in the Mainland and in Hong Kong, whether the Hong Kong authorities will establish a software centre in Hong Kong to provide software quality testing services and develop the "software development process improvement" technology, so as to support the development of Hong Kong as a collecting and distributing hub of software for the Mainland and overseas regions as well as cooperate with software enterprises in the Mainland to secure orders for outsourced software from all over the world; if it will, of the details; if not, the reasons for that?

Reply:

Madam President,

(a) We have learnt from the relevant authorities in the Mainland that the proposed Implementation Method for Government Procurement of Software (Procurement Method) has yet to be promulgated. However, in view of the possible negative impact of the Procurement Method on the software industry in Hong Kong, we have conveyed the industry's concerns to the Mainland authorities. We are also considering whether we should seek to include software produced by Hong Kong software developers in the agenda for the third phase of the Mainland and Hong Kong Closer Economic Partnership Arrangement (CEPA III).

(b) To encourage the local software industry to develop Open Source Software (OSS) and promote the wider use of OSS in the private sector, the HKSARG has been providing funding and various forms of support to the related programs and activities.

To better gauge the adoption of OSS in the market, the Commerce, Industry and Technology Bureau (CITB) and Hong Kong Productivity Council (HKPC) conducted a survey in 2003-2004 on the adoption of OSS in Hong Kong's business sector.

In July 2003, the Government provided funding support through the SME Development Fund (SDF) to establish a Linux Resources Centre to promote and support the wider adoption of OSS in small and medium enterprises (SMEs).

Also with funding support provided by the SDF, HKPC and the Linux Resources Centre jointly launched a SME Linux Jumpstart Program. The program will include testing of relevant software to establish an information database of field-tested Linux solutions. It will also conduct six seminars to help SMEs source the right OSS business solutions so as to increase their productivity and service quality.

To promote the wider use of OSS in the community, the Office of the Government Chief Information Officer (OGCIO) has conducted awareness courses on OSS for secondary school students between November 2004 and January 2005. A total of 78 classes attended by 1,560 students were held.

Within the Government, the OGCIO has also organized a series of promotional and training programs on the adoption of OSS. Last year, 570 government officials attended 11 seminars and product showcases organized by the OGCIO, and 20 related training courses were held for 325 civil servants in 2003 and 2004.

Besides, training programs on OSS are also provided by a number of local institutions, such as HKPC, Vocational Training Council, and other product and service vendors.

(c) With the support of the Government's information technology (IT) policies, HKPC has established a Software Industry Information Centre (SIIC) and a Software Engineering Unit to provide integrated support services to help the Hong Kong software industry improve the quality of its software products and generate further business opportunities.

One of the main functions of the SIIC (the Centre) is to assist the local industry to tap into the software outsourcing market. In February this year, the Centre will, in cooperation with the Hong Kong Trade Development Council (HKTDC) and the Hong Kong Information Technology Federation (HKITF), arrange 10 local companies to attend the Outsourcing Summit in the United States to publicize and promote Hong Kong's outsourcing services and capability. In the course of preparation, the Centre also helps Hong Kong enterprises to identify Mainland partners so as to enhance their appeal for outsourcing businesses.

In addition, the Centre organises IT exhibitions where products of Hong Kong and the Mainland enterprises are displayed together so as to strengthen cooperation between the two places and expand business opportunities. In cooperation with the HKITF, the Centre has launched the IT Solution Directory portal which serves as a cooperation platform for Hong Kong and Mainland IT enterprises. Through this portal, Mainland enterprises can obtain the latest information about Hong Kong IT products and services. The Centre also regularly conducts surveys on IT adoption and industry development trends, publishes case studies and best practices guidebooks, and helps promote the image of the industry through IT awards, Capability Maturity Model (CMM) assessment grants, and publication of various promotional materials.

With regard to promoting Hong Kong-Guangdong (HK-GD) cooperation, HKPC, in conjunction with Guangzhou Tianhe Software Park, Guangdong Software Industry Association, Hong Kong Science & Technology Parks Corporation, and the Chinese University of Hong Kong, championed the establishment of a Pearl River Delta Software Export Alliance at a conference held in Zhuhai last December. The purpose of the proposed Alliance is to enhance HK-GD cooperation, boost their competitiveness, and explore the potential of exporting the software developed in the HK-GD region and securing software subcontracting work from the international market.

The main functions of the Software Engineering Unit (the Unit) of HKPC are to help the local IT enterprises to understand more about the software engineering methodology and its applications, promote the adoption of internationally recognised standards, and advocate software engineering certification such as software quality assurance and CMM certification. Starting from 1 January 2005, the Unit has become the Hong Kong System Integration (SI) Qualification Assessment Centre to provide assessment services for the local industry applying for SI qualification certification in the Mainland. Certified enterprises will be eligible to bid for SI projects in the Mainland and hence expand their business opportunities.

We are open to whether the functions of the above-mentioned Centre and Unit should be expanded to provide software quality testing services and develop technology for improving the software development process. We welcome concrete proposals from the industry.

Ends/Wednesday, February 2, 2005

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