HK$17B has been pledged by the financial secretary of Hong Kong to begin building the key infrastructure necessary to support a thriving Fintech and tech center in the city.
In particular, John Tsang Chun-wah in a statement focused on fintech as an area or exploration and interest for Hong Kong. The interest in fintech completely makes sense within the greater context of Hong Kong's positioning within global finance.
And of course, there was a major focus on the potentially ubiquitous solutions within blockchain and cryptos.
In last year's budget meetings, the Steering Group on Financial Technologies has recommended a variety of activities to encourage, grow and sustain fintech within Hong Kong. One of the most notable recommendations was to encourage the level of foreign students and workers involved in financial technology.
While fintech was clearly a focus, broader initiatives were also announced. For example, within that massive HK$17B figure, a sizable HK$8.2 billion has been committed by Hong Kong Science and Technology Parks Corporation to promote diligence within smart manufacturing and research.
No matter what positive initiatives the Hong Kong government lays out there will, of course, be skepticism. Michael Gazeley, the founder of Hong Kong cybersecurity firm Network Box, expressed concern that while the current initiatives show a distinct interest in developing technology, the initiatives must also support the technology that emerges. Certainly a valid claim, but first things first Michael.
Mukesh Bubna, founder of the peer to peer lending service Monexo says that he feels that regulations were growing too slowly as compared with other similar districts in the region, such as Singapore.
Bubna went on to say:
[Hong Kong] is an old economy and Hong Kong needs to move fast if it wants to reinvent itself. You’ve got to reinvent before these industries die and that’s not what I’m seeing in this budget.
While both of these criticisms are valid, they should also be put within context. Hong Kong and Singapore have emerged as the clear leaders of financial activity in the region. That emergence was really relatively recently. The fact that these commerce centers, bureaucracy considered, can pivot and move so quickly is astonishing. Los Angeles, CA, as one of many examples, is in the shadow of Silicon Valley, yet only in the past 3-5 years has it's prized Silicon Beach tech district started to emerge.
The reality is that tech and applicable interest verticals are moving so quickly that by the time you upload your tech initiatives they are outdated. It was a long and arduous road for Hong Kong to achieve its level of commerce supremacy in the region. Districts like Singapore and Hong Kong will not be relinquishing that crown anytime soon. The infrastructure and workforce, for the most part, is set. They just need capital...and capital is cheap these days. I applaud them for taking a play out of the "How to Stay Relevant" playbook. Let's look forward to seeing what innovation comes from these new initiatives.
Featured image from Shutterstock.