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Speech by S for IT at Europe Day event entitled "Ideas from Europe, Ideas from Hong Kong" (English only) (with photo)

     Following is the speech by the Secretary for Innovation and Technology, Mr Nicholas W Yang, at the Europe Day event entitled "Ideas from Europe, Ideas from Hong Kong" today (May 9):

Vincent (Head of European Union Office to Hong Kong and Macao, Mr Vincent Piket), distinguished guests, ladies and gentlemen,

     Good afternoon to you all. It is my pleasure to join you here today to celebrate the Europe Day. I would like to thank the European Union Office to Hong Kong and Macao and the European Chamber of Commerce in Hong Kong for hosting this event, and allow me to share with you Hong Kong's innovation policy.

     Innovations as we know are driven by great minds and great ideas. These are abundant in Hong Kong. In the past few weeks, a number of Hong Kong-grown innovations and innovators have attracted the spotlights internationally.

     The team led by Professor Nancy Ip (Dean of Science, Director of the State Key Laboratory of Molecular Neuroscience and the Morningside Professor of Life Science) at the Hong Kong University of Science and Technology (HKUST), in collaboration with the University of Glasgow and Zhejiang University, has found out that a protein called IL33 found in human body could be potentially developed as an effective treatment for the Alzheimer's disease. This groundbreaking study was conducted at the HKUST and the results have just been published in the prestigious scientific journal, Proceedings of the National Academy of Sciences, in the United States.

     At the recent 44th International Exhibition of Inventions of Geneva held in April, teams from Hong Kong were awarded 20 gold, five silver and six bronze medals. Among them, a team from the Hong Kong Baptist University was also awarded the Grand Prix Award for a novel process to reinforce glass surface by applying a thin film coating of sapphire. Professor Joseph Sung, who is here with us today, would be proud of the achievements of the teams from the Chinese University of Hong Kong at the same exhibition, which brought home three gold medals and one bronze medal. In addition, teams from the Hong Kong Science Parks, our R&D centres and a secondary school also won outstanding achievements. This was a proud day for Hong Kong in innovation and technology achievement.

     Innovation and technology are firmly on the policy agenda of the HKSAR Government. Over the years, the Government has been providing world-class technology infrastructure for enterprises, research institutions and universities to flourish. We offer financial support to the industry, academia and research sector to develop and commercialise their R&D results, nurture talent and strengthen the collaboration with the Mainland and other economies. Since the establishment of the Innovation and Technology Bureau in November last year, we have introduced new measures to create a more vibrant and robust innovation ecosystem in Hong Kong.

     The key role of the Innovation and Technology Bureau is to connect and facilitate. As a connector, we connect the Government, the academia, businesses and the research sector, both locally and overseas. Hong Kong enjoys the combined advantages of "one country, two systems", strategic location in the Asia-Pacific region, proximity to the huge Mainland market, robust intellectual property protection, a sound legal system with independent judiciary, and world-class information technology infrastructure and financial system. Hong Kong is also the "super-connector" to the Mainland of China and the rest of the world. This applies not only to financial services, trade and culture, but also to science, innovation and technology as well.

     Our role as a "super-connector" is best highlighted by our recent collaboration with Karolinska Institutet (KI), which will set up its first overseas branch, the Karolinska Institutet China-Hong Kong Center, in Hong Kong later this year. The complementary strengths that the KI and Hong Kong universities enjoy in regenerative medicine led to an agreement to deepen our research collaboration in this promising area. Last month, a tripartite task force among the HKSAR Government, the Municipal Government of Shenzhen and the Karolinska Institutet met to explore co-operation opportunities by leveraging the strengths of Hong Kong and Sweden in research, as well as the strong industrial production capabilities in Shenzhen. We do encourage and welcome more research and innovation organisations from EU (European Union) coming to Hong Kong.

     As a facilitator, the Government will provide the initial resources to kick-start a healthy and robust ecosystem which is conducive to innovation and technology development. I believe the private sector of Hong Kong will continue to take the lead in using innovation and technology to drive further economic growth.

     In this year's Policy Address and Budget, the Government has invested an unprecedented amount of HK$18 billion to promote innovation and technology development. The initiatives announced in the Policy Address help strengthen the building blocks of our innovation and technology ecosystem, while the financial support programmes in the Budget aim to foster development of the local economy, in particular the small and medium enterprises in the short and medium term.

     University is a wellspring of ideas and discoveries. Having worked as the Executive Vice President of the Hong Kong Polytechnic University for five years, I can say that we do have world-class universities and research capability in Hong Kong. We believe their active involvement in midstream R&D would add fresh impetus to commercialising their R&D outcomes. That is why we propose a HK$2 billion Midstream Research Programme for the universities. The move is to encourage our University Grants Committee-funded institutions to conduct more midstream and translational research. Better articulation with downstream R&D will bring more realisable commercial opportunities.

     I am glad to note that the Research Grants Council of Hong Kong and the European Commission have reached an agreement last November to set up a collaboration scheme which will allow co-funding of Hong Kong researchers in the Horizon 2020 programme. In addition, under the Government's flagship R&D funding programme, the Innovation and Technology Fund, we will support up to 50 per cent of the R&D and project funding to be conducted outside Hong Kong. These will provide strong incentives for our local organisations to pursue international collaboration with their counterparts in the EU. Today, innovation and technology are the driving forces of industrial upgrade and transformation. The application of innovative technologies such as cloud computing, big data, robotics, artificial intelligence and Internet of Things, has given rise to opportunities to promote smart production and high value-added industries, and these are what we call "re-industralisation".

     We are not talking about the return of traditional manufacturing industry. Re-industrialisation refers to the development of high value-added industries or manufacturing processes, in areas where Hong Kong has strength and potential, such as robotics, smart city and healthy ageing. These industries do not require large amount of land while utilising smart manufacturing, big data analysis or Internet of Things. Making reference to other technologically advanced regions in the Mainland and overseas, development of high value-added industries is a commonly adopted effective strategy to enhance economic competitiveness.

     To promote re-industrialisation, the Government has revised the industrial estate policy with admission requirements favouring the innovation and technology industries. In future, the Hong Kong Science and Technology Parks will build and manage specialised multi-storey industrial buildings targeted for re-industrialisation use.

     The Hong Kong Science and Technology Parks is planning two pilot projects to develop high-efficiency multi-storey buildings in the Tseung Kwan O Industrial Estate. The total cost is estimated to be HK$8.2 billion. These high-efficiency buildings will have to meet higher requirements than ordinary industrial buildings in ventilation, drainage, load-bearing and environmental-friendliness in order to cater for the use in smart production. Detailed study on the economic case and financial arrangements is expected to be completed in the first half of 2016. We will then submit the funding proposals to the Legislative Council. Hopefully no filibustering. If approved, the construction of the first high-efficiency building is expected to be completed in 2020, providing some 1.5 million square feet of gross floor area.

     Start-ups play an important part in the commercialisation of ideas and research outputs as well as creating jobs, in particular for young people. To encourage venture capital investment in innovation and technology start-ups, the Government will set aside $2 billion to set up an Innovation and Technology Venture Fund to address the pre-series A funding gap in our current ecosystem. We will co-invest with private venture capital funds on a matching basis. This will also bring in the much needed investment, professional expertise and network of the venture capitalists to the Hong Kong ecosystem.

     Our support to the business sector does not end here. Small and medium enterprises or SMEs are the backbone of our economy, accounting for over 90 per cent of the business establishments in Hong Kong. However, to maintain or enhance competitiveness, they need the resource and capability to innovate. A Pilot Technology Voucher Programme will be launched later this year. It will provide funding assistance to SMEs for the use of technological services and solutions. Apart from improving SMEs' productivity and business processes, this will also create additional business opportunities for local technology solution service providers.

     Technology has the potential to "do good" as well as "do well". Promoting the adoption of innovation and technology to address social issues is high on my agenda. We can better help the elderly to age well at home, or to deliver better public services. To this end, we will earmark $500 million to set up an Innovation and Technology Fund for Better Living to finance projects that make use of innovative ideas or technologies to improve our daily lives, in areas of transport, education, environment, and healthcare, etc. The Innovation and Technology Bureau will foster cross-bureaux collaboration and public-private partnership to promote digital inclusion, making our lives more comfortable, convenient and safer.

     In a globalised Internet-driven economy, almost every country or region, large and small, all turn to innovation and technology as new economic drivers. At a time when the competitiveness of Hong Kong's traditional service industries is challenged, we need to embrace innovation and technology. I am confident that Hong Kong people's adaptability, and more importantly, the ability to face failure and excel, will be the key to our successful transformation into a knowledge-based economy.

     Thank you very much.

Ends/Monday, May 9, 2016
Issued at HKT 19:58


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