HKPC Supports Future-focused 2025-26 Budget Empowering SMEs for Transformation and Upgrading Promoting Industrial Transformation and Economic Growth through I&T Paving the Way for Infinite Future Opportunities

(Hong Kong, 26 February 2025) Hong Kong Productivity Council (HKPC) welcomes Financial Secretary’s commitment to increasing resources for innovation and technology (I&T) in the 2025-26 Budget (the Budget). With the robust support of the nation and the leadership of the HKSAR Government, HKPC is confident in Hong Kong's economic prospects and will continue to align with the HKSAR Government in responding to challenges through reform.

Hon Sunny TAN, Chairman of HKPC, expressed strong support for the Budget. He dubbed technological innovation as the core engine of economic growth, particularly in strengthening new economic drivers and enhancing the competitiveness of traditional industries. He stated HKPC fully aligns with the HKSAR Government’s implementation of I&T-related policies and proactive approach in attracting leading tech companies to establish a foothold in Hong Kong. By leveraging Hong Kong’s international application scenarios, HKPC will pave the way for Mainland Chinese enterprises to go global. Capitalising on Hong Kong’s favourable I&T edge, HKPC is committed to foster the development of artificial intelligence (AI), low-altitude economy, green technology, life and health technology, microelectronics and IP-intensive industries. Additionally, the Budget supports upgrading and transformation of SMEs through various Government Funding Schemes, including the HK$100 million Pilot Manufacturing and Production Line Upgrade Support Scheme (Manufacturing+), thereby attracting market capital and smaller-scale SMEs to establish smart production lines through subsidies.

Utilising Government Funding Schemes to Propel New Industrialisation
HKPC is delighted about the launch of the HK$100 million two-year Pilot Manufacturing and Production Line Upgrade Support Scheme, which introduces advanced technologies into existing production lines. Meanwhile, the New Industrialisation Acceleration Scheme, which was introduced last September, has recently approved its first project under the endorsement of the New Industrialisation Vetting Committee for Jean-Marie Pharmacal Company Limited, a subsidiary of the Jacobson Group. HKPC has been working closely with various entities under the Jacobson Group since 2022, providing technical R&D support and tailored microfactory solutions.

Pioneering Manufacturing Paradigms and Driving Industrial Evolution with AI
HKPC supports the HKSAR Government's initiative to develop Hong Kong into an international exchange and co-operation hub for the AI industry. By focusing on cutting-edge research and the practical application of technological innovations, HKPC is dedicated to developing AI as a key industry that enhances the upgrading and transformation of traditional sectors. HKPC's technology expert team focuses on addressing industry pain points and tailoring solutions for various sectors. In the past three years , the team has garnered over 270 awards, including prestigious international R&D accolades for projects related to AI, such as the "InspecSpider" and the "Autonomous Air-ground Cooperative Tunnel Inspector." These achievements underscore HKPC's commitment to maintaining research excellence at the highest international standards.

Supporting Local SMEs in Going Global and Seeking Business Opportunities
Hong Kong currently has 360,000 SMEs, which account for 98% of all businesses in the region. As a key implementing agency for funding programmes in Hong Kong, HKPC welcomes the Budget's renewed investment in the “Dedicated Fund on Branding, Upgrading and Domestic Sales” (“BUD Fund“) and the optimisation of the application process to assist SMEs in exploring markets in the Chinese Mainland and overseas.

To enhance the vitality and competitiveness of Hong Kong's SMEs, HKPC supports the HKSAR Government's efforts to attract domestic and international enterprises to establish headquarters or branches in Hong Kong, thereby promoting industrial diversification. Hong Kong should continue to leverage its "two-way springboard" advantage to attract SMEs from both local and international markets, fostering the formation of a strong and dynamic SME industry cluster. HKPC will actively utilise Hong Kong's international context to help high-end technology enterprises from the Chinese Mainland go global, supporting private economic development and encouraging corporate innovation. Since 2017, HKPC has successfully promoted nearly 80 projects aimed at assisting businesses in developing markets in ASEAN, covering regions such as Vietnam, Thailand, Indonesia, Singapore, and Malaysia. This initiative actively supports local SMEs in "going global" and contributes to the high-quality co-construction of the Belt and Road Initiative.

Accelerating Green Development and Realising Sustainable Development in Industries
“Development of green industries is a major international trend and key to addressing global climate change.” HKPC is encouraged by the proposals put forward by the HKSAR Government in the Budget aimed at building a green future. HKPC welcomes the HKSAR Government's continued investment of resources and looks forward to collaborating closely with its Automotive Platforms and Application Systems R&D Centre (APAS) to develop green technologies, including green transportation, green methanol, and hydrogen. It aims to promote practical applications and facilitate the transition of the public transportation system towards a greener model, ultimately achieving a smart and sustainable collective transport system.

As always, HKPC will comprehensively support industrial transformation and upgrade through advanced technology, FutureSkills training, and Government funding programmes, aiming to develop "microfactory" and enhance the value of the "Made in Hong Kong" brand. Moving forward, HKPC will continue to be a key driver of new industrialisation, actively collaborating with renowned partners from the Chinese Mainland and aboard to promote Hong Kong’s I&T stories. Additionally, HKPC will support the accelerated development of the Northern Metropolis, strategically invest for the future, and flexibly utilise funds to create societal value while contributing new momentum to the nation's high-quality development.

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Hon Sunny TAN, Chairman of HKPC, expressed strong support for the Budget. He dubbed technological innovation as the core engine of economic growth, particularly in strengthening new economic drivers and enhancing the competitiveness of traditional industries. He stated HKPC fully align with the HKSAR Government’s implementation of I&T-related policies and proactive approach in attracting leading tech companies to establish a foothold in Hong Kong. By leveraging Hong Kong’s international application scenarios, HKPC will pave the way for Mainland Chinese enterprises to go global. Capitalising on Hong Kong’s favourable I&T edge, HKPC is committed to foster the development of AI, low-altitude economy, green technology, life and health technology, microelectronics and IP-intensive industries. Additionally, the Budget supports upgrading and transformation of SMEs through various Government Funding Schemes, including the HK$100 million Pilot Manufacturing and Production Line Upgrade Support Scheme, thereby attracting market capital and smaller-scale SMEs to establish smart production lines through subsidies.