Francis Ho has been closely associated with the industrial and technological development of Hong Kong. Before he became Permanent Secretary, he was Director General of Industry from 1996 to 2000 and then the founding Commissioner of the Innovation and Technology Commission. The mission of the Commission is to spearhead Hong Kong's drive to become a world class, knowledge based economy in the 21st Century.

In that capacity Mr. Ho was responsible for the formulation and execution of the Commission's pioneer programmes. These programmes aim at strengthening Hong Kong's applied R&D activities and institutions; promoting corporate R&D and enhancing their linkage with university resources; fostering technology entrepreneurism through government venture capital funding schemes, grants to small business research and technology incubation programmes; and developing of technology infrastructure such as the Hong Kong Science Park and industrial estates.

In response to the vision of Mr Tung Chee-hwa, as outlined in his policy address, to develop Hong Kong as a major technology centre in the region, Mr Ho says he is very confident that we can achieve this goal.

Mr Ho's confidence is based on a series of strategies designed specifically for Hong Kong's technological development. They include five aspects.

Strategy is the Key
The first goal is the provision of adequate infrastructure for technology development. Many initiatives such as the Science Park, Cyberport, Industrial Estates, the Growth Enterprise Market and venture capital funds have been launched to strengthen Hong Kong's technology infrastructure and promote technology entrepreneurship. Together they will create an environment in which technology businesses can thrive, and in which entrepreneurs can use their technological skills to create successful technology businesses.

The second aim is to build up human capital to meet the challenges of the new economy by implementing proactive schemes to attract talent from all over the world, including mainland China. One significant development is the special "Admission of Talents Programme" aimed at pulling down immigration barriers to talent from mainland China.

"In the past, on completion of their studies in Hong Kong, graduate and undergraduate students from mainland China had no choice but to return to the places they had come from. Under the terms of the 'Admission of Talents Programme' however, if they find employment in Hong Kong, they can stay. We have a role to play in this scheme and we will advise the Immigration Department whether an application should be supported or not," Mr Ho says.

The third aspect of Hong Kong's strategy to become a major technology centre is the enhancement of technology cooperation with mainland China. "We've been working closely with the Chinese Academy of Sciences, various ministries and major universities in order to tap into the scientific and technological capabilities in the mainland. In fact, I will be going to a high-tech conference in Beijing. Activities such as these will help mutual understanding and are conducive to strengthening Hong Kong's overall technological capabilities," Mr Ho adds.

Raising Hong Kong's overall high-tech capabilities also depends on a fourth component of Hong Kong's technology strategy - the fostering of a partnership between local universities and industry. In the past, universities and industry went their own ways without talking to one another. "What we do is to get them together to form a beneficial partnership so that industry can get input from universities' research efforts while universities get feedback from industry as to what would contribute to Hong Kong's economic and industrial development," Mr Ho continues.

According to Mr Ho, two kinds of initiatives launched recently have been quite successful. One is research and development (R&D) projects proposed by universities and supported by industry. At the same time, universities can also get funding from the government. It is interesting to note that the funding ratio between industry and government has changed from 1:8 in the past to 1:5.5 at present, which means industry is now taking a more active role in supporting university research.

The other kind of research, the University-Enterprise Collaboration Scheme, is led by industry. Companies with good R&D ideas that want to engage a university to carry out the research can make a proposal to the government. After deciding that the project is viable, the government will contribute half of the project's funding to the university that conducts the research. The other half of the funding will come from industry. Mr Ho reveals that this type of project is very popular within industry and that there are already around a dozen projects being funded this way.

Last but not least, the strategy for developing Hong Kong as a regional technology centre includes the improvement of the total business environment. This means, for example, maintaining the rule of law and the protection of the intellectual property rights.

Know Yourself and Your Competitor
Mr Ho sees two major challenges for Hong Kong - the shortage of talent in the technology field and the deterioration of our living environment. The first has been made abundantly clear as Hong Kong has gone through structural changes since the Asian financial crisis in 1997. But the above-mentioned strategy to attract talent from all over the world and from mainland China is aimed at solving this problem.

The challenge of improving the living environment - improving our air quality and reducing traffic congestion - means we need the concerted efforts of industries, the government and the general public. In other words, we need to show people from Silicon Valley that Hong Kong is an attractive city in which to make a home. Mr Ho believes that in two to three years Hong Kong will be able to meet these challenges.

He points out that Hong Kong has in fact many unique advantages that are the envy of its neighbours. "If you look at our infrastructure and world-class financial system, Hong Kong is ahead of most other economies in Asia. According to the business community, our legal system and the business environment are superior," he says.

Looking at our competitors, mainland China has vast scientific and technological resources, Taiwan has a well-established computer industry and Singapore has an active government-led strategy for developing high technology. Rather than engaging in head-on competition, Mr Ho believes that Hong Kong's strategy should be to seek complementary partnerships, because "we are not in a zero-sum game".

"The important thing is to know what we can do and what others can do, so that we will be able to grab the opportunities when they arise," he says. "For example, we have taken advantage of low labour costs in the mainland to set up production bases there. In the telecommunications field, we are always among the first to introduce new technology, such as CDMA, and competitive measures. In the venture capital area, the Growth Enterprise Market has no match among our neighbours. What we can do is to change our competitors into partners so that we can complement each other and achieve some sort of synergy."

The Way Forward
As to what extent the government should be involved in the endeavour to develop technology in Hong Kong, Mr Ho stresses that "we don't want to pursue too much in the area of government guidance because we want to avoid government intervention. But a positive development is that Mr Tung Chee-hwa recently appointed a Council of Advisors on Innovation and Technology that will be able to provide a clear roadmap for the development of science and technology in relation to Hong Kong industry".

As Tradelink was established in the environment of using technology to boost productivity and create wealth, Mr Ho has seen a pattern of expansion from its initial business focus of textile and import/export electronic data interchange to the field of e-commerce. He is confident that Tradelink will be able to maintain its first mover advantage and leverage its sizeable client base to achieve greater success.