Fund to foster innovative spirit

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When Popo Law Po-Ching said the most impressive part of her trip to Israel was "the library", she wasn't talking about any public library.

University students and entrepreneurs-to-be in Hong Kong can obtain financial support from the Innovation and Technology Fund to start businesses or commercialize their research achievements. [Photo / China Daily]

University students and entrepreneurs-to-be in Hong Kong can obtain financial support from the Innovation and Technology Fund to start businesses or commercialize their research achievements. [Photo / China Daily]

She was referring to a government-funded co-working space named The Library Tel Aviv, which provides space and other services to local startup companies at a low cost.

Law's remark stirred a heated discussion among 10 of her fellow Hong Kong University of Science and Technology students, who had just returned from a five-day trip to one of the world's innovative hubs, organized by the Li Ka Shing Foundation.

Many of them were worried that the Hong Kong government has been acting too slowly in supporting local entrepreneurs and innovation.

But on the day after their return, Hong Kong Chief Executive Leung Chun-ying proposed in his policy address on Jan 15 to inject HK$5 billion ($645 million) into the Innovation and Technology Fund to boost the development of innovative technology.

The proposed new funding marks the SAR government's move toward Hong Kong's economic restructuring. Analysts have become aware of the economy's vulnerability because of its heavy reliance on the financial industry and real estate market, which they fear may cost Hong Kong a sustainable future.

University students and ambitious entrepreneurs-to-be can anticipate strong support from the ITF, which will devote up to HK$24 million annually to students and academics to start businesses or commercialize their research achievements.

Research and development in the private sector will also receive funding from the ITF under the newly established Enterprise Support Scheme in an effort to keep pace with global trends as well as the rise of the Chinese mainland as a land of innovation.

"The HK$5 billion fund injection is definitely a blessing for people in R&D," said Alan Lee, a local inventor and entrepreneur.

Lee said the dominance of the financial industry and real estate market has overshadowed the innovative spirit in Hong Kong for too long.

The ITF "will empower a lot more companies to move their ideas from the drawing board to actual R&D", said Allen Ma Kam-sing, chief executive of Hong Kong Science & Technology Parks Corp, while envisaging Hong Kong steering toward an innovation-driven economy.

Hong Kong's economic structure needs diversification through developing innovation and technology, he said.

The service sector accounts for more than 90 percent of Hong Kong's GDP, while manufacturing industry only contributed 1.5 percent in 2012, according to official statistics.

The ratio of R&D expenditures to GDP has faltered at around 0.75 percent during the past 10 years, compared with a world average of 2.13 percent, according to the World Bank.

Having begun in the late 1990s, Hong Kong's innovation development is at a relatively early stage compared with other established innovation hubs, said a representative of the Innovative and Technology Commission, the fund's administrative body. But the SAR government's expenditure on R&D is growing annually.

"Entrepreneurship has definitely taken off in Hong Kong," said Ma, who has witnessed an increased number of applications to the Hong Kong Science & Technology Parks incubation program, as well as newly opened co-working spaces and privately sponsored acceleration programs during the past year.

More than money

The young minds on the Israel tour, however, noticed an obvious gap between Hong Kong and the acclaimed innovation hub.

"In Israel, people engaged in startups go all in. It's about chasing dreams for them, while Hong Kong companies are more profit driven," said Jack Chi-kwan Chan, a second-year student studying global business at Hong Kong University of Science and Technology.

Chan, who plans to start his own company after graduation, said that what Hong Kong startups need is "more than just money".

"It's more important to find someone who believes in you and is willing to back you," he said.

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