Former Hong Kong leader CY Leung urges city to heed country’s call to keep up with digital economy developments

Hong Kong is not keeping up with the latest digital economy developments despite repeated calls from the country, former city leader Leung Chun-ying has said, urging industry heads to join him at China’s summit on the topic next month.

“Until now, I found no signs or sparks of the digital economy in Hong Kong. It is outdated if we focus on what the digital economy is,” said Leung, who is a vice-chairman of China’s top political advisory body.

In a forum about the developments of the digital economy on Saturday, he urged stakeholders, especially those from the innovation and technology sector, to “actively” play their part in “aligning Hong Kong with the national digital economy strategy to explore a new development direction for the financial hub”.

Digital economy refers to a new economic system that uses big data and advanced digital technology. These developments are used to optimise economic structures and activities.

Leung said real estate investment trusts (REITs), which allow individuals to invest in large-scale, income-producing property, was one of the areas Hong Kong could consider when strengthening its digital economy while serving the country’s needs.

During his recent trip to Fuzhou in Fujian province, he found the city had included data centres as part of their REITs. The yield from the investments would be used to develop the digital economy.

“Hong Kong is an international finance centre. If those data centres and other similar infrastructure [from the mainland] could be added to REITs in Hong Kong, it will start attracting foreign investment and become a big boost to Hong Kong and the country,” Leung said.

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“The digital economy in Hong Kong lags behind. If we continue like this, nothing will come to fruition,” he said, urging industry leaders to join a mainland summit next month.

According to the latest White Paper on the Global Digital Economy (2022) released by the China Academy of Information and Communications Technology, China ranked second, after the US, among 47 countries in terms of the added value of the digital economy in 2021.

The size of China’s digital economy has doubled between 2016 and 2021, growing from 22.6 trillion yuan (US$3.2 trillion) to 45.5 trillion yuan, representing 39.8 per cent of GDP by the end of the five years, the White Paper shows.

The Digital China Summit, to be held from April 27 to 28 in Fuzhou will be attended by central and provincial authorities, as well as academics and entrepreneurs.

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“Attendees will discuss the areas in which the country will intensify efforts to grow its digital economy. So Hong Kong can be better informed and prepare itself to tap into those areas as a starting point to develop its digital economy,” said Allen Yeung Tak-bun, president of the Greater Bay Area International Information Technology Association.

It is not known whether the Hong Kong government will take part in the summit in April.

The Hong Kong government established the Digital Economy Development Committee, chaired by the Financial Secretary Paul Chan Mo-po, in June 2022.

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Chan said in his budget this year that the committee had conducted in-depth studies on the infrastructure needed to promote the development of the digital economy, cross-boundary data transfer in a convenient, efficient and secure manner, as well as the transformation of enterprises and human resources support.

The committee is also tasked with making plans to promote the artificial intelligence industry in Hong Kong including the formation of an AI supercomputing centre unveiled in Chan’s budget speech.