The Hong Kong’s 2015-16 Budget Focus on Financial Development
BUDGET SPEECH: Hong Kong’s Financial Secretary John C Tsang in his budget speech has announced a strong focus on financial sector development (80% of Hong Kong’s GDP) and support of fintech startups.
38. A new wave of entrepreneurship, in the form of start-ups, is emerging around the world. Many start-ups boldly apply new technologies, information technology in particular, disrupting the traditional mode of operation. They translate state-of-the-arttechnologies into competitive products and services that change consumption patterns and open up new markets.
39. Last few years saw a notable burgeoning of start-ups in Hong Kong. They managed to build up a wider clientele base by conducting in-depth market studies, over and above their clearly-defined positioning and inspiring marketing strategies. I have seen an enterprise developing wireless chargers for electronic devices, and another designing a mobile application for pre-ordering coffee.
40. Hong Kong is among the most advanced information and communication technology hubs in the world. Our well-established business support services and sound system to protect intellectual property (IP) rights provide favourable conditions for the growth of start-ups. Many public and private organisations offer support, including provision of co-working space, incubation programmes, business advisory services, and assistance in building partner networks. The number of such organisations has increased by tenfold over the past three years, and they includeworld-renowned organisations such as Nest and Accenture.
41. InvestHK launched a large promotion campaign known as “StartmeupHK” two years ago to promote our advantages as a leading global hub for start-ups. The campaign has attracted innovative start-ups with potential to our city, and brought HongKong-based enterprises to the attention of many international angel and venture capital investors.
42. We have witnessed a growing interest amongst investors in Hong Kongstart-ups. International IT giants such as Microsoft have set up offices here to look for new businesses that are worth investing in. Start-ups nurtured by the Hong Kong Science and Technology Parks Corporation (HKSTPC) and the Cyberport have also attracted hundreds of millions of dollars of investment.
43. Financing needs increase as start-ups grow. To further encourage financing of new enterprises, HKSTPC will earmark $50 million to set up a corporate venture fund for co-investment, on a matching basis with private funds, in start-ups which are located in the Science Park or have participated in its incubation programmes. I shall also ask the Hong Kong Mortgage Corporation Limited (HKMC) to expand and enhance the Microfinance Scheme.
44. In addition, the proposed injection of $5 billion to the Innovation and Technology Fund will help strengthen support for relevant enterprises.
45. We strive to provide start-ups with enhanced hardware and software support. HKSTPC will extend the Leading Enterprises Acceleration Programme to help more companies with potential to consolidate their businesses, raise capital and improve corporate management.
46. From this year onwards, free online government information will be released in digital formats to encourage development of more applications by start-ups. Manystart-ups have developed a wide range of mobile applications by exploiting such public sector information, including information on real-time traffic and weather conditions.
47. Financial technologies are also an investment target of many venture capitalists or crowd funding efforts. Financial technologies that help facilitate functions such as payment, clearing and settlement systems, big data analytics, cloud computing, information and risk management and network security can enhance operational efficiency and help open new modes of development for the financial sector. Being an international financial centre with years of experience in technology, Hong Kong is an ideal place for developing financial technologies. I have asked the Secretary for Financial Services and the Treasury to set up a steering group to study how to develop Hong Kong into a financial technology hub together with industries, research and development institutions as well as regulatory authorities.
48. I hope to improve the ecosystem for local start-ups and technological enterprises to tie in with the general direction of moving our economy up the value chain and enabling local industries to diversify.