Secretary for Commerce & Economic Development Gregory So
We have experienced a phenomenal growth in our start-up ecosystem over the past couple of years. For example, the number of co-working spaces and accelerator programmes has increased from three to well over 40, and there are start-up-related events in our city almost every single day.
Also, quite a number of our start-ups have made remarkable achievements – some have secured substantial investments, some have been acquired by large corporations, while others have carved their niches in the global marketplace. These trends demonstrate the rising participation of entrepreneurs, mentors and investors in our vibrant ecosystem.
You may ask what makes Hong Kong stand out as a start-up hub. First, Hong Kong is a free and competitive economy. We follow the common law legal system and adopt internationally recognised codes of practices in business and commerce. We have a low and simple tax system with no goods and services tax or value-added tax.
We have a clean and efficient government and a level playing field for all companies. Indeed, you would expect nothing less from an economy that is consistently ranked as the freest in the world. We have retained the top spot in the Heritage Foundation’s Index of Economic Freedom for 21 years in a row. This status reflects real advantages for starting businesses in Hong Kong.
Then, the resources. We know that start-ups and tech enterprises need many things: seed funding, office space, work visa facilitation, communities network, business development support, design support, promotion platforms, market access and serial investment, et cetera.
And so we offer an excellent network to address such needs. We have different types of public and private initiatives especially designed to nurture start-ups and attract talents, including incubation programmes, government funding schemes, networking communities and co-working spaces, et cetera.
We are also blessed with the geographical advantage. Our location has enabled us to become the key platform between Mainland China and the world in technological collaboration and trading. We are strategically located at the heart of Asia and at the doorstep of Mainland China. Half of the world’s population can be reached within five hours’ flight time from Hong Kong.
For start-ups and tech enterprises looking to tap into Asia’s huge market potential, we are the most convenient base, providing world-class transport, and unrivalled logistics and information and communications technology infrastructure.
What else have we done? In line with our policy to promote innovation and technology, Hong Kong has a comprehensive intellectual property protection regime to effectively protect the fruits of innovation and creativity.
With overseas IP owners eagerly eyeing the Asian and the Mainland market, Hong Kong is poised to develop into a regional marketplace providing professional services in licensing, franchising and IP registration. Our intermediaries can help manage and add value in the IP trading and management processes.
Start-up is indeed an area with huge potential for growth in Hong Kong. I am sure you would be interested to hear what are the potential growth areas where Hong Kong has a unique advantage. Allow me to highlight a few.
Potential growth areas
First, FinTech. As a global financial centre and a hub for retailers and brands from around the world, Hong Kong offers an ideal platform for FinTech start-ups and enterprises to facilitate functions such as payment, clearing and settlement systems, big data analytics, cloud computing, information and risk management and network security. Our city may enhance operational efficiency and help open new modes of development for the financial and e-commerce sectors.
Second, the Internet of Things (IoT). We are now living in a world full of devices and systems which talk to each other. IoT is indeed a disruptive and transformational technology, and its impact will certainly be felt across all industries and all areas of society. These IoT devices need to be physically manufactured, and this is where Hong Kong comes in.
Hong Kong has deep and broad expertise in design and software development. More importantly, we are strategically located next door to Shenzhen, the hardware capital of the world. We have easy access to the Pearl River Delta and its sophisticated supply chain and logistics platform. We have all the ingredients for start-ups and tech enterprises to develop their prototypes, validate their products and develop large-scale manufacturing to bring them to market in the fastest time.
Towards smarter cities
The third area is smart city technologies. Multinational corporations such as Schneider Electric are using Hong Kong as the base for developing and testing total solutions and devices. Other major players like Siemens, Hitachi, NEC and Panasonic are also closely watching the market opportunities in this area.
With the new phase three development of the Hong Kong Science Park, the expansion plans at the Hong Kong International Airport, and planned developments in the densely populated urban areas of Hong Kong, our city offers unique opportunities for start-ups and large corporations involved in smart city technologies to launch their solutions for Asia from here.
Our Government is committed to helping transform Hong Kong into a leading destination and hub for innovation and entrepreneurship. I encourage you all to consider using Hong Kong as your lab, showcase and global launch pad.
Hong Kong offers opportunities for technology firms like yours to get a foothold in the massive, yet complex, China market as well as markets across Asia. Apart from business-friendly policies, Hong Kong also has a great location, sophisticated infrastructure and a robust IP protection regime to help innovative companies take off in Asia.
Secretary for Commerce & Economic Development Gregory So gave these remarks at the National Institute of the Entrepreneur in Mexico City.