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Hong Kong economy
OpinionLetters

Letters | Hong Kong’s Strategic Tech Fund should drive growth of impact investing

  • Readers suggest that a new government fund to be launched should align with the UN’s Sustainable Development Goals, and highlight the need on International Youth Day to reckon with young people’s evolving communication style

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Commercial and residential buildings on Hong Kong Island are reflected on the ground at East Coast Park Precinct in Causeway Bay on August 5. Photo: Yik Yeung-man
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I read with considerable interest the Post’s exclusive interview with the financial secretary on the launch of a HK$5 billion Strategic Tech Fund. Entrepreneurs and investors will certainly welcome this initiative. But the government should be more “strategic” and prudent in using taxpayers’ money to subsidise commercial ventures.
As outlined in the budget, the fund will invest in businesses that will be important to the competitive development of Hong Kong. As the government is working out the implementation details, it is important to go back to some basic principles on why and how the government should intervene in the operations of the private sector.
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Government intervention is only justified when a pure market mechanism does not work. There are businesses that require a much longer research and development cycle and more protracted processes of market validation, and thus pose greater risks to investors with potentially slower and lower rates of returns.

These are ventures that require more patient capital and are usually businesses that have strong social impact, such as edtech (education technology), biotech, health tech, and green tech. Getting funding for these ventures is generally hard, as they appeal neither to mainstream investors nor philanthropic and charitable money.

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Therefore, the Strategic Tech Fund should be used to support the growth of ventures that align with the United Nations’ Sustainable Development Goals and are crucial to the sustainable development of Hong Kong society.

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