Expert help is being called in to ensure the SAR does not get left behind in the hi-tech race.
Mr Tsang announced that the Chief Executive would soon appoint a council of advisers on innovation and technology.
Executive Councillor Raymond Ch'ien Kuo-fung, who chairs Internet venture Chinadotcom, said that although the civil service was strong, it had only a few people who understood cutting-edge development.
'We need a team in Government who's really attuned to what's happening in the private sector, what's happening in the research-and-development area, especially in the applied field in places like the United States, Europe, Israel, Japan,' said Mr Ch'ien.
In addition to the council, Mr Tsang will chair a new inter-bureau committee charged with co-ordinating innovation- and technology-related efforts across the Government.
Hanson Cheah Fan Min, executive director of venture-capital firm AsiaTech Ventures, said the committee was overdue. 'Finally, someone is listening to us,' he said.