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LCQ19: Re-industrialisation and industrial estates
     Following is a question by the Hon Ho Kai-ming and a written reply by the Secretary for Innovation and Technology, Mr Nicholas W Yang, in the Legislative Council today (May 17):
     The Government, in collaboration with the Hong Kong Science and Technology Parks Corporation (HKSTPC), has been actively promoting re-industrialisation in recent years, and it revised the Industrial Estate (IE) policy in 2015 so as to make more efficient use of the lands in the three IEs under the HKSTPC in order to support science, innovation and technology (I&T) based industries. On the other hand, quite a number of Hong Kong manufacturers have planned in recent years to relocate the production lines of their non-I&T industries on the Mainland back to Hong Kong and intend to apply for admission to IEs. In this connection, will the Government inform this Council:
(1) whether it knows the current number of operating companies in each IE, with a breakdown by business type;

(2) whether it knows, in respect of each IE in each of the past five years, (i) the utilisation rate of the floor area, (ii) the floor area available for leasing, and (iii) the number of applications for admission received from non-I&T companies, with a breakdown by business type;

(3) whether it knows if the HKSTPC has plans to expand its IEs in the next five years; of the latest progress of the authorities' plan to develop new IEs near the Liantang/Heung Yuen Wai Boundary Control Point;

(4) of the measures put in place by the authorities to facilitate the relocation of the production lines of non-I&T industries back to Hong Kong and their admission to IEs, and to support the development of such industries in Hong Kong; and

(5) as there are views that building the brand of "Made in Hong Kong" as a guarantee of good quality products is conducive to promoting re-industrialisation in Hong Kong, of the policies and measures put in place by the authorities for building the brand of "Made in Hong Kong" in the next three years, and how the authorities will assist in the building of brand images for locally made products?
     Our reply to the five parts of the question is as follows:
(1) A list of industries of the 142 companies currently operating in the Industrial Estates (IE) at Tai Po (TP), Yuen Long (YL) and Tseung Kwan O (TKO) are as follows:
Industry TPIE YLIE TKOIE Total
1. Food & Beverages 17 4 4 25
2. Biotechnology & Pharmaceutical 8 7 0 15
3. Broadcasting 2 0 2 4
4. Information & Telecommunication (e.g. Data Centre, Submarine Cable and Satellite) 3 0 10 13
5. Printing & Publishing 4 3 3 10
6. Support Services (e.g. Aircraft Engineering and Maintenance, Machinery Engineering Services and Maintenance, Examination, Testing and Certification) 4 4 3 11
7. Machinery & Parts 12 4 1 17
8. Plastic Resins & Plastics Products 4 2 0 6
9. Green Technology 0 3 1 4
10. Others (e.g. Building Materials, Chemical & Gases, Electronics Parts and Paper Packaging) 16 13 8 37
Total 70 40 32 142
(2) and (3) Under the old IE policy, IE sites are mainly granted to qualified factory operators for them to design and build standalone factories. In general, factory operators in the IEs need not belong to any particular industry, but the applicants have to demonstrate that their operations cannot be accommodated in ordinary multi-storey industrial or commercial buildings. For those meeting the mandatory admission criteria, priority will be given to those factory operators which involve significant investment, high added value, employment of a large number of technical personnel, as well as the use of new or upgraded technology. In accordance with the above policy, the Hong Kong Science and Technology Parks Corporation (HKSTPC) had received seven admission applications in the past five years, involving industries such as data processing, telecommunication, pharmaceutical, traditional Chinese medicine, food processing, construction materials, etc.
     In the past five years, the land utilisation rate of the three IEs is as follows:
2012 100% 99% 92% 97%
2013 100% 99% 93% 97%
2014 100% 98% 90% 96%
2015 100% 98% 89% 96%
2016 100% 96% 85% 94%
     The Government revised the IE policy in 2015, with a view to supporting re-industrialisation, attracting high value-added technology industries and manufacturing processes. Since then, the HKSTPC would build and manage specialised multi-storey industrial buildings for rental to multiple users, and consider applications for admission from different sectors. The HKSTPC would still consider granting land to meritorious applicants to build standalone factories in exceptional cases. The HKSTPC is currently developing a Data Technology Hub and an Advanced Manufacturing Centre at TKOIE. They are expected to be completed in 2020 and 2021/22 respectively.
     Apart from building new multi-storey industrial buildings, the HKSTPC would encourage factory operators in the IEs to surrender premises which have not been fully utilised, and identify suitable premises to be refurbished for leasing. In the past five years, the HKSTPC had two buildings surrendered by grantees available for lease. The factories concerned are located in TPIE and YLIE, providing floor area of 17 416 square metres and 7 930 square metres respectively, which are both fully occupied at present. In the meantime, the HKSTPC is refurbishing a surrendered factory in TPIE which would provide a gross floor area of 8 500 square metres. It is anticipated that tenants can move in at the earliest in September this year.
     In the long run, the Government is planning to expand YLIE on a site of about 16 hectares in the Wang Chau area to the southwest of YLIE. The Government has also provisionally identified a site of about 56 hectares near the Liantang/Heung Yuen Wai Boundary Control Point for the long-term development of IEs. The HKSTPC is now carrying out a preliminary planning study, which is expected to be completed by the end of this year.
(4) According to the information provided by the Commerce and Economic Development Bureau (CEDB), the Government's policy on support for industry is to create a business-friendly environment for the trade and provide them with timely and appropriate support so that our trade can flourish. Some enterprises, especially those engaging in high-end manufacturing, are well-positioned to consider performing high value-added production processes that are less land and labour-intensive in Hong Kong. Hong Kong enterprises, including those interested in relocating their operations back to Hong Kong, can obtain support through the support schemes under various government departments and quasi-government organisations in areas such as financing and enhancing their overall competitiveness.
     As regards technological support, the Innovation and Technology Fund (ITF) was established in 1999 to finance applied research and development (R&D) projects that contribute to innovation and technology upgrading in manufacturing and services industries in Hong Kong and promotion of innovation. There are various funding programmes under the ITF, including the Innovation and Technology Support Programme, the University-Industry Collaboration Programme, the Enterprise Support Scheme, the Patent Application Grant, etc. One of the aims of these funding programmes is to encourage more R&D from universities and enterprises and promote re-industrialisation. Besides, the Hong Kong Productivity Council (HKPC) has been assisting the manufacturing sector to move towards high value-added production and gradually into "Industry 4.0", including organising international conferences and seminars on industrial innovation strategy, and establishing the "Industry 4.0 Upgrade and Recognition Programme" with the Fraunhofer Institute for Production Technology, Germany. The HKPC will inaugurate the "Industry 4.0" technology demonstration centre this year to showcase and promote information exchange on the concept and smart features of "Industry 4.0".
(5) As advised by the CEDB, the Trade and Industry Department (TID) seeks to assist Hong Kong enterprises in developing brands and exploring the Mainland and overseas markets. Its SME Export Marketing Fund provides financial support to small and medium enterprises (SMEs) in participating in export promotion activities, while the SME Development Fund provides financial support to non-profit-distributing organisations to carry out projects to enhance the competitiveness of SMEs in general or in specific sectors in Hong Kong.
     In addition, the Government launched the $1 billion Dedicated Fund on Branding, Upgrading and Domestic Sales in June 2012 to provide funding support to Hong Kong enterprises and non-profit-distributing organisations, so as to assist enterprises in enhancing their competitiveness and furthering their business development in the Mainland.
     The TID co-organises seminars from time to time with the Hong Kong Trade Development Council, local business associations and other relevant organisations and invites renowned local, Mainland and overseas entrepreneurs and experts to share their experience in establishing brands and market development strategies. In addition, the TID disseminates practical information related to brand development to enterprises for reference through various channels (such as brand promotion website).
Ends/Wednesday, May 17, 2017
Issued at HKT 14:55
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