Session C: Hong Kong as an Innovation/ Technology Centre

Moderator: Mr Nicholas Brooke Panelists: Mr K C Kwong, Sec for Information Technology & Broadcasting Mr Tony Tai, General Manager, IBM China/HK Ltd Prof Ping Ko, Dean of Engineering, Hong Kong University of Science & Technology Themes: Information Technology & Infrastructure Promoting Technology-based Service Business Promoting Innovation in Government & Private Services Research & Development in IT

Hong Kong enjoys a competitive edge to become an Internet hub of the Asia Pacific region, because of its excellent telecommunications infrastructure, unique position vis-a-vis mainland China and bilingual language capability. Government policies and initiatives, as outlined in Digital 21, is a fourth strength in promoting IT in Hong Kong. Government services will be provided through the Internet. Salary tax return, payment of government bills, application for driving licenses and revision of personal particulars are some of the services earmarked for the first phase of the electronic service delivery scheme. The standards and approaches developed by the Government will be made available to the private sector, so that they can develop competing infrastructures if they wish. The Hong Kong Post will serve as a route certification authority. The government will establish a public key infrastructure to instill public confidence in electronic business. An electronic transactions bill is being drafted to confer equal status on e-records as their paper-based counterparts. It will also provide legal support for digital signatures certified by recognised authorities so that they will carry the same status as handwritten ones. Local development of innovative Internet content and services will also be encouraged.

Traditional business models, rules and processes are being redefined by the web explosion. Hong Kong is already in the e-reality. It is crucial for IT vendors to be customer-centered by translating technology into practical and affordable business solutions. The commercial sector should act as a catalyst to expand the application and usage of IT. Infrastructure and training aside, the commercial sector needs to be involved in building up Hong Kong as an innovative and technology centre. Enterprises that embrace technology solutions have a competitive advantage over those who fail to see the benefit of such applications. Most big corporations have already implemented various kinds of technology. They should look beyond themselves to encourage their suppliers and end-users to do so. Constrained by limited budgets, SMEs can seek advice from business promoting organisations such as the Trade Development Council, Productivity Council, Article Number Association and General Chamber of Commerce to enhance their technological competitiveness. There are consultancy services for flexible solutions based on SMEs’ existing infrastructure.

An information technology center needs to be self-sustaining and part of the business infrastructure. Innovations need to be commercialised to make an impact on the economy. This requires special talented people with the right combination of skills, including breadth and depth in technology know-hows, understanding of and experience in the running of a technology enterprise, as well as commitment to Hong Kong. A loop needs to be developed so that IT outputs can be produced to attract continuous investments and a steady supply of talents. They need to understand how Hong Kong and China can work together to become a big business entity. Hong Kong does not have a significant talent pool to build a sizable technology industry. Ways need to be identified quickly to lure talents to establish their home base in Hong Kong. Venture funds started by the Government and the establishment of the Chief Executive’s Commission of Innovation and Technology are positive steps. Singapore is willing to take the risk and lower the barriers to attract IT investments. The Government can play an important role in sponsoring some of the IT projects so that their applications can be debugged and tried out.

Plug and Play Data Services

A Hong Kong University professor urged various government arms, such as those in charge of census and statistics, trade and industry as well as lands, to mount a concerted effort in making the right types of quality data available in a readily usable format. He noted that data need to be massaged before they could be put into practical use. The usual cost-recovery policy should not be applied to the retrieval of such data. Instead, the Government should appreciate the GDP growth to be derived from such data services. Another academic agreed that Hong Kong was lagging behind places, including Taiwan, in terms of both the scope and prices of electronic data and services provided by the Government.

Economic Philosophy

An academic raised the question of whether the Government had been spending money wisely on developing information technology. He held that the primary aim for developing IT was to support the economy. In view of Hong Kong’s sizable investment in Southern China, he urged the Government to deploy public resources to help small and medium enterprises to regain their competitiveness through the use of IT. Mr Kwong supported the call for a review on whether the Government’s economic philosophy of positive non-intervention should be adjusted.

Brain Gain

An economist from the Hong Kong University of Science and Technology stated that the pool of local applicants was not adequate to support doctorate research programmes. High calibre applicants from mainland China could fill the gap. He considered the immigration laws as being too conservative for Hong Kong to retain these talents. Another professor noted that Singapore had been recruiting students from Hong Kong mainly for their entrepreneurship spirit. These students would be required to serve the host country for a number of years. Several speakers had pointed to the need to diversify the universities’ student base. To improve our education system, an academic suggested that better career prospects for teaching professionals and higher quality textbooks in Chinese were crucial.

Technology vs Business Sense

Several participants concurred on the need to hone the business sense of the technology professionals. A professor asserted that the universities should improve the technological sense of the business people, and the business sense of the professionals and academics in engineering. Prof Ko said his faculty was aware of the issue and measures had been taken for it to embark on the entrepreneur path. It was noted that while mainland China was stronger in research and development, Hong Kong was equipped with a better understanding of the markets.

Commitment and support

Professor Tien Chang-lin, who chaired the Chief Executive’s Commission on Innovation and Technology, was invited to speak. He said that the Government need to speak out and present a vision more vigorously to generate commitment and support from the community at large and the business sector in particular. Prof Tien said the Chief Executive had contributed a lot in this regard and other government officials should speak out more strongly on the topic. A private sector participant submitted that Hong Kong could learn from Singapore for its clear vision and detail implementation plan on hi-tech entrepreneurship. He noted that account executives were assigned to Singapore’s Economic Development Board to lure targeted companies to set up R&D centers in the country.

Centre of Innovation

A participant was pessimistic about the prospects for Hong Kong to become an innovation centre. He suggested that it would be more realistic for the Government to put its resources in what Hong Kong had been good at – imports and exports. Mr Kwong, however, maintained that the application of technologies was also an important element of innovation. He noted that an e-delivery system, for example, would soon be in place for electronic transactions. Prof Ko pointed to the fact that there was no lack of foreign critics when Taiwan launched its initiatives in the seventies. He remarked that technology advanced rapidly. He was positive that there were a lot of opportunities and early starters might not necessarily be able to retain their lead.

Technology Corp

In a post-conference note, a professor commented that short-term efforts should be focused on stimulating existing industries so that they would become more receptive to innovation and technology. The government should put more emphasis on dissemination of information and hands-on training. He proposed that recent graduates could form a “Technology Corp” to work with Hong Kong companies to raise their comfort and competence in using technology.