Developing new opportunities through innovation and technology

Innovation and Technology (I&T) is also a major policy area for the Hong Kong government. In his Budget 2019-2020 speech, Financial Secretary Paul Chan reported at length on the work the government has been conducting to develop innovation and technology in Hong Kong. Key areas of development revolve around promoting research activities, the building of R&D infrastructure and talent pool.

Just last year, $10 billion was injected into the Innovation and Technology Fund (ITF) to support research and development activities. Administered by the Innovation and Technology Commission, the ITF provides funding to support a myriad of activities ranging from enterprise R&D to startup prototype production. Billions of dollars have also gone into fostering research in areas such as artificial intelligence (AI), robotics at the Science Park, as well as R&D commercialization by universities and research centers.

To support research activities, expansion works are ongoing at the Hong Kong Science Park and Cyberport. The so-called Science Park New Extension Stage 1 will add 74,000 square meters of floor space for laboratories and work space for healthcare, AI and robotics research when completed this year. The Cyberport, with an ecosystem of 1,200 companies and start-ups, will get an additional earmark of $5.5 billion for its expansion. This will provide 66,000 square meters of floor space for offices spaces, conference venues and data service platforms.

To ensure a steady pipeline of research professionals, the government has made the funding terms of its Researcher Program more competitive. It is also helping to build more housing for researchers. Separately the government will deploy $500 million to implement IT Innovation Labs in secondary schools over the next three years.

Another pillar under the government’s I&T policy is promoting reindustrialization. The objective is to help current manufacturers develop high-end, high value-added production capabilities and reduce Hong Kong’s reliance on service industries. Plans by the Innovative and Technology Bureau are in place to seek funding to help manufacturers set up high end production lines in Hong Kong.

American Express as a trusted, alternative financing partner

Government funding schemes provide a much needed source of financing for SMEs, especially when banks tighten their belts during an economic slowdown, according to David Caton, Director of SME Business Development, Global Commercial Services at American Express. However, he pointed out that SMEs with more urgent need of funds should get a handle on the length of time and the paper work which could be required to apply for government funding.

Depending on their specific circumstances, some SMEs may turn to alternative financing sources. “American Express’s payment solution is always a good alternative source of fund for SMEs while leveraging governmental funds,” says Caton. “It’s faster and more convenient way to fund operations with our solutions which come with up to 51 credit free days . It helps SMEs access short term financial outlay to cover their cash flow gaps."

Apart from financing liquidity, working capital and cash flow needs, American Express also provides access to other potential benefits such as extended payment terms and extended payment periods for buyers, while also guaranteeing accelerated payment for suppliers. Optimizing payment periods in this way frees up much needed cash and facilitates better working relationships with suppliers and customers. Put another way, using Amex corporate payment solution allows cash to be available sooner and for longer, giving SMEs the control over their payments needed to achieve efficiencies.