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Main points of speech by CS at Roundtable Meeting of Boao Forum for Asia Annual Conference 2012 (with photo)

     The Chief Secretary for Administration of the Hong Kong Special Administrative Region, Mr Stephen Lam, today (April 2) delivered a speech entitled "Development of Innovation and Technology and Life Science in Hong Kong" at the Roundtable Meeting on "Life Sciences: Driving the Next Wave of Technology Revolution" of the Boao Forum for Asia Annual Conference 2012. Following are the main points covered in the speech:

Distinguished guests, ladies and gentlemen,

     It is a tremendous pleasure to join you all today and address this distinguished forum of experts from different places in the region.

     I am very pleased to have this opportunity to share with you some of Hong Kong's initiatives on technology development. My presentation will focus on three areas, namely the latest development of innovation and technology in particular on the life science front in Hong Kong, some examples of our world-class research on life sciences, and our advantages as a capital-raising platform for life science.

Snapshot of Innovation and Technology in Hong Kong

     The HKSAR Government realises that innovation and technology is one of six new industries to be developed as a priority. It is our aspiration to ride on our advantages and develop Hong Kong as an innovation and technology hub in Asia.

     Our goal is to implement policies that provide a clear runway for innovation and technology to fulfil its potential and really take off in Hong Kong. Success will require close collaboration among the government, industry, research and academic sectors to synergise valuable research efforts.

     Through multi-dimensional initiatives, the HKSAR Government has been supporting research and development (R&D) activities that drive an idea through each stage from inception to product commercialisation.

     Hong Kong is a relatively small city of 7 million people. Our R&D expenditure as a ratio to GDP is still low when compared to neighbouring economies. However, we have gradually built up a solid foundation for innovation activities and developed some interesting inventions along the way.

     Hong Kong has established its position as a major international financial and trading centre. This makes Hong Kong a fertile land where business minds, creative thinking and financial resources converge. This combination of factors has helped produce some positive and encouraging outcomes on the innovation and technology front.

New Inventions

     One of our entrepreneurs took the world by storm by developing one of the first commercially viable electric cars, named MyCar. This is despite the fact that Hong Kong has no history of automobile manufacturing.

     MyCar was the first Hong Kong-developed electric vehicle to hit the international market. It is currently on sale in European countries such as Britain, Italy, France, Denmark and Austria. This green vehicle was the product of collaboration between Hong Kong Polytechnic University and a local enterprise.

     It was named the electric vehicle of the year at the 2008 Green Fleet Awards. MyCar has demonstrated Hong Kong's R&D ability and helped fuel the further development of green technologies in our city.

Health-care Indicators

     Today's forum is focused on life science.

     In this era of rapid technological advances in medical and related fields, investment in health and medical research and application is a primary focus for health-care advancement.

     As a result of many decades of investment in community health, Hong Kong now has a quality health-care system supported by a highly professional team of health-care workers.

      Life expectancy for men in Hong Kong is 80.5 years and even longer for women - 86.7 years. These 2011 figures are among the highest in the world.

     Our infant mortality rate has been falling steadily over the past 20 years and, according to the latest figures in 2009, was the third lowest in the world.

     All children in Hong Kong are protected against communicable diseases under a Childhood Immunisation Programme. The HKSAR Government also provides high-risk groups with free seasonal influenza vaccinations each year to promote good health and long life.

Facilitating Environment for Life Science Development

     Over the past decade, the HKSAR Government has provided dedicated funding support for health and medical research including two major areas. One area is public health and health services and the other is control of infectious diseases.

     Public health and health services comprise primary care, tobacco control, mental health, health promotion and other initiatives. Control of infectious diseases is getting more prominent in the aftermath of the outbreaks of SARS, avian influenza and swine flu.

     Starting from this year, our various health-related research funds have been consolidated into a HK$1.4 billion Health and Medical Research Fund (HMRF). This aims to provide more targeted and effective funding.

     To capture the boundless opportunities in this new wave of life science innovations, the HKSAR Government is committed to nurturing a vibrant life science sector in Hong Kong. This will require suitable hardware and software.

     Purpose-built infrastructure, world-class laboratory facilities, financial support and business involvement are all clustered at the Hong Kong Science Park. This is a conducive environment for life science entrepreneurs to turn promising findings into commercially attractive assets.

     Dedicated funding programmes including the HK$18 billion Research Endowment Fund and the HK$5 billion Innovation and Technology Fund have been launched. They provide financial support to meet the distinct needs of academic research and applied R&D respectively.

     Since technology start-ups generally do not generate profits or pay tax in their early money-burning years, tax concessions offer little help. In the light of this, we have launched a R&D Cash Rebate Scheme to reimburse the private sector 30 per cent of their R&D investment in eligible research projects.

World-class Research on Life Sciences

     Six higher education institutions in Hong Kong are actively engaged in life science research. Some of their research achievements are groundbreaking in their respective fields. More importantly, these scientific breakthroughs are not merely laboratory successes, but have been applied to make an impact in real life situations. I would like to take this opportunity to cite the achievements of three of our renowned scholars as illustrations.

Professor Dennis Lo's non-invasive pre-natal diagnosis

     Down Syndrome affects about 1 in 800 pregnancies. It is the predominant reason why many pregnant women opt for pre-natal diagnosis. Unfortunately, the major methods for pre-natal diagnosis are invasive, like amniocentesis, which had a 0.5 per cent to 1 per cent risk of causing miscarriage.

     Contrary to the then traditional biological teaching that human DNA should be present inside cells rather than "floating" outside cells, and that fetal cells should not be found in the maternal blood circulation, Professor Dennis Lo of the Chinese University of Hong Kong discovered DNA of the unborn fetus in the plasma, that is non-cellular components of its pregnant mother's blood.

     He discovered that genetic abnormalities, such as Down Syndrome, could be detected by directly analysing a small amount of blood sample from the mother. This revolutionary approach has been hailed as the "holy grail" of pre-natal diagnosis. It overcomes the limitations of the conventional pre-natal genetic screening methods. The test has been made available as a clinical service in Hong Kong, the Mainland of China and the United States since last year, and is likely to be launched in Europe sometime this year.

     This new non-invasive source of fetal DNA also reveals a variety of useful genetic information concerning the fetus. One example is sex determination for the pre-natal testing of sex-linked diseases, such as haemophilia and forms of muscular dystrophy. Another example is fetal RhD blood group analysis for determining the blood group compatibility between the mother and her fetus. These two applications are now in clinical use in Europe and the US.

Professor Malik Peiris' control of pandemic and inter-pandemic influenza

     Another example of our achievements is on the control of pandemic diseases. Spring 2003 was a bleak time for many of us in Hong Kong. Our city was in the grip of an unknown severe respiratory disease which quickly spread across 32 countries. It defied all known medical treatment methods and claimed more than 700 lives.

     Scientists around the globe were working frantically day and night to hunt down the disease-causing agent in a bid to find a cure and stop the virus spreading.

     Professor Malik Peiris and his research team at the University of Hong Kong managed within weeks be the first to identify the culprit virus, which we now call the SARS coronavirus. After the SARS period, their subsequent research proved that bats were the original source of the virus, passing it to civet cats and eventually to humans.

     Professor Peiris' understanding of the epidemiology, evolution, pathogenesis and control of avian and human influenza viruses eventually led to effective preventive measures for SARS and avian flu. For example, Hong Kong has now adopted a measure of banning poultry markets from holding live poultry overnight. This means that any birds offered for sale during the day must be sold or alternatively slaughtered and put into freeze overnight. This has almost totally wiped out the incidence of bird flu being transmitted in poultry markets.

     Professor Peiris' scientific findings also shed light on novel therapeutic approaches for severe influenza virus. For example, the research team discovered some new antigen parts of the virus that do not change during pandemic evolution and can potentially be used for developing a universal vaccine - the Achilles' heel in treating influenza.

     The research team also contributes much in formulating strategies concerning how the disease severity of a future newly emerged pandemic can be reliably estimated in real time. This is a gap that was identified by the World Health Organization (WHO) as a priority need for responding to future pandemics.

     The rapid viral diagnostic laboratory at Queen Mary Hospital is now recognised by the WHO as one of the International Reference and Verification Laboratories for SARS. It is also one of the WHO H5 reference laboratories worldwide for diagnosis and research of influenza A H5N1 infection.

     In recognition of their contributions, Professor Malik Peiris and Professor Dennis Lo have since been elected as Fellows of the Royal Society, the prestigious British academy of science founded in 1660.

Professor Nancy Ip's neuroscience research

     In addition, I will share with you the story of a prominent neuroscientist, Professor Nancy Ip of the Hong Kong University of Science and Technology. She has dedicated her scientific career to elucidating the molecular mechanisms that control brain functions such as learning and memory.

     She made important discoveries of a number of proteins that promote the survival, development and maintenance of brain cells, and their functional roles in the nervous system. These molecules are potential pharmaceutical agents in the treatment of diseases such as Alzheimer's and Parkinson's disease.

     Professor Ip is now leading a multi-disciplinary programme focused on neurodrug discovery under an Area of Excellence initiative of the HKSAR Government. She has also been recognised by various international awards including the National Natural Science Award, the L'Orˆmal-UNESCO for Women in Science Award 2004, and the Knight of L'Ordre National du Mˆmrite in France.

     The work of our scientists and the commitment of our community to innovation and life science is attracting companies to Hong Kong to establish R&D collaborations.

Hong Kong as a Capital-Raising Platform for Life Sciences

     Meanwhile, out of the laboratory, Hong Kong's status as an international financial centre is also a big drawcard for new talent and ideas. Venture capitalists and investors from Hong Kong, the Mainland of China and across Asia are keen to invest in the "next big thing".

     Another key factor for innovation to flourish are the values of our community. In Hong Kong, we are committed to providing a business-friendly environment, guaranteed with free flows of capital, information, ideas and talent. Our open market, low and simple taxes and robust intellectual property protection regime are attractive to our entrepreneurs.

     Hong Kong has a proven track record as a capital-raising centre. For each of the past three years, the Hong Kong stock market has led the world in funds raised through Initial Public Offerings. Last year alone, total IPO funds raised reached US$33 billion.

     At present, over 70 life science-related companies are listed on the Hong Kong Stock Exchange or Growth Enterprise Market. We believe that there are tremendous potentials for the life service sector to tap into our capital market and make good use of our traditional strengths in this regard.

     In fact, an increasingly popular way for overseas firms to raise capital for operations in the Mainland is through the issue of Renminbi bonds. Hong Kong is the first and only place to issue offshore Renminbi bonds, or so-called "dim sum" bonds. Last year, there were 91 "dim sum" bond issues in Hong Kong. The total issuance value was almost 108 billion Renminbi (RMB107.9 billion). We see good opportunities for companies to raise Renminbi capital in Hong Kong to fund R&D activities in the Mainland.


     We may not be particularly big as an economy. But we are free and nimble. In global research terms, maybe we are only small or medium sized, but Hong Kong is practical. Over the years, our formula for success has been (a) to design and discover in Hong Kong; (b) to manufacture in the Mainland and develop that huge consumer market; and (c) to float the companies and raise funds in the Hong Kong Stock Exchange.

     This formula for success has worked for many industries. It should also do so for the life sciences.

     Thank you very much.

Ends/Monday, April 2, 2012
Issued at HKT 19:33


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