HK urged to put innovation on fast track
Hong Kong should use the Guangdong-Hong Kong-Macao Greater Bay Area plan and Belt and Road Initiative to catch up with the Chinese mainland in innovation, an international business academic said on Thursday.
Bruce McKern, adjunct professor of UTS Business School at the University of Technology Sydney, said Hong Kong could also act as an intermediary for foreign investors in meeting the huge capital needs that come with these development plans.
McKern made the remarks at a seminar on the Guangdong-Hong Kong-Macao Greater Bay Area and Belt and Road Initiative. The event was organized by the Maritime Silk Road Society, with Executive Council member and lawmaker Regina Ip Lau Suk-yee as co-chair.
The mainland had found its solution to a number of strategic challenges– that is, innovation for higher productivity, regional integration and new foreign engagement, McKern said.
In terms of innovation, he said the mainland “has done extremely well” in past decades, building an innovation ecosystem from scratch by starting as a follower, then meeting world standards. It is now seeking to dominate the global market.
He illustrated the point with figures, saying the mainland has 146 high-tech innovation parks and hundreds of economic and industrial zones. Its investment in innovation has exceeded 2 percent of GDP since 2014 with continuous growth.
Mainland investment in research and development was estimated to reach about $223 billion last year, accounting for 2.1 percent of GDP.
At an innovation and technology conference earlier this week, Chief Executive Carrie Lam Cheng Yuet-ngor said Hong Kong’s current investment in innovation and technology only accounts for 0.7 percent of GDP.
In the global innovation contest, Hong Kong is also challenged by the lack of an advanced innovation ecosystem.
McKern urged Hong Kong to think about what it can learn from the mainland’s innovation development; one solution is to collaborate with Shenzhen to build an innovation hub using the Greater Bay Area as an opportunity.
The Greater Bay Area, along with the Belt and Road Initiative, are part of mainland’s response to accelerating regional integration and new foreign engagement, McKern said.
He noted that integrated regions, or what he called industry clusters, have high impact on GDP, innovation and employment.
The Greater Bay Area is important in this respect as the goals are to strengthen the region’s role in the global economic supply chain and strengthen key industries in the area, such as high-tech manufacturing and trade-related services.
In 2015, the region generated about 11 percent of the mainland’s GDP, but accounted for just 5 percent of the population and 0.6 percent of the land area, McKern said.
He said the Belt and Road Initiative would generate huge capital needs. He sees great opportunities for Hong Kong as an intermediary and base for foreign investors, not only for Belt and Road projects but also their investment needs from the Greater Bay Area and other clusters.