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Speech by SCED at Annual Dinner of Hong Kong Electronic Industries Association (English only)

    Following is a speech by the Secretary for Commerce and Economic Development, Mr Frederick Ma, at the Annual Dinner of the Hong Kong Electronic Industries Association this evening (December 14):

Professor Chan (Chairman of HKEIA), distinguished guests, ladies and gentlemen,

     Good evening.  It is my great pleasure to join you for your annual dinner.  Your association has played a pivotal role in steering Hong Kong's electronics industry through a remarkable period of economic growth. I congratulate you on the 27th Anniversary of your association.

Electronics industry in Hong Kong

     By all measures, Hong Kong's economic performance has been excellent this year, with GDP growth of 6.2% for the third quarter, and an average of 6.1% for the first nine months.  The importance and contribution of our electronics industry towards this should not be underestimated.

     Last year the industry accounted for nearly half of Hong Kong's total exports.  This includes computer parts and components, audio-visual and telecom equipment and consumer electronics such as toys and games.  We remain the electronic gadgets capital of Asia.  In 2005, Hong Kong was, in value terms, the world's second largest exporter of a wide range of electronic products, including phone sets, computer parts and accessories as well as video recording apparatus.

     Hong Kong traces closely the global development trend and is well placed to meet the ever-changing global demands on sophisticated high-tech products.  Hong Kong companies have always been well-known for their efficiency in management.  Against the fast-changing markets, we emphasise quick response in providing effective marketing services, and in monitoring the changing product trends.  In face of the growing concern of quality-conscious and environmentally-conscious buyers, more and more Hong Kong companies have been accredited with ISO 9000 (Note 1) and ISO 14000 (Note 2) in recent years.  This has further strengthened quality assurance to our customers.  

     A winning combination of local entrepreneurship and strong manufacturing base in the Pearl River Delta area has helped our electronics industry expand rapidly.  Today, there are more than 10,000 Hong Kong-owned electronics factories in the PRD, mainly in Shenzhen, Huizhou and Dongguan.  This, in turn, makes the PRD a key production base for electronic products in the Mainland.

Challenges of electronics industry

     The industry, however, faces a number of challenges.  Environmental concerns is certainly top the list.  We need to develop cleaner and more efficient production techniques that meet new environmental requirements.

     Towards this end, the Hong Kong Productivity Council, backed by the Government, has been providing environmental technology support services to the industry.  This helps Hong Kong-owned factories in the PRD adopt cleaner production technologies and energy-saving techniques.  It not only reduces the amount of materials used but also cuts pollution.  More specifically, the Productivity Council helps firms enhance the environmental design of their products, choose more environmental-friendly materials, manage the consumption of materials and energy effectively, control pollution, as well as recycle used products.

     Last December, the Productivity Council conducted a pilot cleaner production project to help Hong Kong-owned factories in Dongguan and Shenzhen conserve energy and reduce air pollution.  I am confident these efforts will help factories alleviate the negative effects on the environment in the long term.    

Technology advancement of electronics industry

     At the same time we have to work on becoming even more competitive.  Most of the enterprises in Hong Kong and PRD have long relied on Original Equipment Manufacturing (OEM).  Today, in face of keener competition brought about by economic globalisation, more companies are switching to Original Design Manufacturing (ODM) and Original Brand Manufacturing (OBM).  It is most important for Hong Kong enterprises to continue zealously to enhance their innovation capabilities and technologies.  

     Last year, we set up five R&D Centres (Note 3) to help firms upgrade their technologies.  The centres focus on areas where Hong Kong has a competitive edge, and has the potential for meeting market needs.  And the DesignSmart Initiative that kicked off in 2004 has provided funding of $76 million to more than 110 companies to promote branding research and business collaboration.

     In addition to this, we also have the Innovation and Technology Fund (ITF) to support projects which are beneficial to industry upgrading.  The ITF has provided total funding of more than $800 million to more than 200 projects related to the electrical and electronics sectors.  These projects aim to upgrade the capabilities of the local industry in areas such as consumer electronics, Integrated Circuit design, opto-electronics and communications.  Advanced processes such as "green manufacturing" are among the important topics of the funded projects.

     All these highlight the importance of the electronics industry in our overall technological infrastructure development.  Electronics is one of the four focus areas of the Hong Kong Science and Technology Park.  The Science Park clusters high tech industries.  Electronics-related companies now account for some 40% of the tenants of the Science Park.  They enjoy advanced facilities and support services, such as IC Design and Development Support Centre, Photonics Development Support Centre and a Wireless Communications Test Laboratory that provides 3G and digital TV broadcasting testing services.  

     The opening of Phase II of the Science Park in September this year highlighted the Government's commitment to meeting growing demand for high quality technological infrastructure.  We welcome more electronics companies to join the Science Park.  


     Ladies and gentlemen, we are facing new challenges in our globalised village. But one thing I know about Hong Kong is that this city thrives on challenges.  The world famous "can do" spirit of the Hong Kong people is alive and well.  The electronics sector certainly can create new opportunities.  In fact, it is already doing so every day, and the Government is helping firms turn these opportunities into a real competitive advantages.

     I thank the association for its work over the past 27 years, and wish you continued success in the future.  Thank you.

Note 1: An internationally recognised standard for quality management system
Note 2: A standard for environmental management system
Note 3: The five R&D centres focus on (1) automotive parts and accessory systems, (2) information and communications technologies, (3) logistics and supply chain management enabling technologies, (4) nanotechnology and advanced materials, and (5) textiles and clothing.

Ends/Friday, December 14, 2007
Issued at HKT 20:13


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