Hong Kong Comes Out Swinging in 2017
As Hong Kong continues to aggressively defend its status as one of the world’s premier locations to conduct business in Asia, there are a number of exciting new initiatives that the Government is pushing forward this year that should excite inbound investors.
One of the city’s greatest strengths has always been its location. Hong Kong due to its proximity has enjoyed direct gateway access to Mainland China particularly with Shenzhen located just a short 45 minute train ride away. Shenzhen which has long been known as the hardware capital of the world is now also being touted as the “Silicon Valley of China”.
Hong Kong also happens to be strategically located at the center of Asia and a mere 5 hour flight away from half the world’s entire population. (Yes, half! 3.5 billion people, primarily in China and India).
As a result, in the past few years the city has witnessed unprecedented growth in the ecosystem. For example, in just the last 4 years the number of startup co-working spaces, innovation labs and accelerator programs has grown explosively from just three to now over 50.
Standing as the signpost for all this inbound investment is InvestHK, a department of the local Hong Kong Government. InvestHK’s mandate is to facilitate inbound foreign direct investment and offer a one stop service to companies who want to set up or grow an office locally. The companies they service range from Large Multinational Corporations, to SMEs, all the way down to new startups. InvestHK also provides startup specific advice via their StartmeupHK Platform connecting academia, corporates, and the private sector all under one umbrella.
The department’s ultimate goal, however, is jobs growth — to bring the best companies in the world to Hong Kong and facilitate startups to scale rapidly thereby increasing their potential to hire local talent.
Here are four key initiatives that are worth keeping an eye out for this year.
1. The Loop — January 2017 started off with a bang as Hong Kong and Shenzhen announced in an agreement to develop an innovation and technology park on 85 hectares of land. The Lok Ma Chau Loop, which is said to be four times the size of Hong Kong’s Science Park, will be according to Chief Executive C.Y. Leung, “Hong Kong’s largest innovation and technology platform ever.” The location will help a number of Hong Kong companies set up a strategic office on the border of Shenzhen proving to be a boon to Hong Kong’s tech industry.
2. Innovation Fund — Also hitting the tape in early January during Chief Executive Leung’s 2017 Policy Address was the announcement of a brand new HK$2 billion dollar government investment fund aimed at boosting technology and innovation in Hong Kong. The Innovation and Technology Venture Fund will provide venture support for startups which would then attract more institutional VC fund flow as well as startup talent into the city. Perhaps aimed to combat some of the criticism that Hong Kong has received due to it’s lack of Government financial support in the ecosystem (compared to Singapore) only time will tell if the fund achieves its longer term goals successfully.
3. StartmeupHK Festival and Hong Kong Fin-tech Week — Our friends at InvestHK/StartMeUpHK have made incredible strides in just a couple years to host and organize two world class events each year showcasing Hong Kong as a true startup and fin-tech hub, attracting tens of thousands of overseas visitors annually. (Last year Elon Musk was the keynote speaker). Hong Kong remains one of the top three financial centers of the world and has the real opportunity to become a top three global startup and fin-tech hub.
4. Central Business District #2 — This is not a new initiative by any means. It was first announced back in 2011 by the Chief Executive during his policy address. Hong Kong’s CBD2 is located in the area that the old Kai Tak Airport used to be. This district, once an industrial base (and still is predominantly warehouses), is now one of the Government’s key focus areas for redevelopment. As the demand for office space in Central is no longer being satisfied, there is a renewed effort to revitalize and enhance the design, connectivity, and infrastructure of the buildings in CBD2.
Jay Kim is a Hong Kong-based investor, author and host of the popular podcast, The Jay Kim Show which educates aspiring entrepreneurs, investors, and startup founders through interviews with top global business leaders. Subscribe via iTunes and feel free to reach out directly to Jay on Twitter @jaykimmer