May 15, 2018 / 11:02 AM / 3 months ago

China pledges to bolster Hong Kong tech push with funding boost

HONG KONG, May 15 (Reuters) - China will boost funding access and support to Hong Kong scientists, a Chinese official said on Tuesday, after President Xi Jinping urged greater co-operation and efforts to strengthen the Asian financial hub’s prowess in information technology.

The move comes as the overseas expansion plans of Chinese tech firms run into challenges, often over supposed links to the government in Beijing, that have raised security fears in the West.

“Accelerating the development of Hong Kong’s technology and innovation sector is a must for keeping the city’s prosperity and stable development,” Huang Wei, China’s vice minister of science and technology, told a forum in Hong Kong on Tuesday.

Huang’s speech reinforced Xi’s call for “concrete measures” of support from government departments for scientists in Hong Kong, to develop it into an “international center of innovative technology”, the official Xinhua news agency said.

Xi’s directive is expected to remove a barrier that prevented Hong Kong-based scientists from using central government grants in the special administrative region.

Mainland research institutions and universities spent 355 billion yuan ($56 billion) on research and development in 2017 as China pushes to become an international technology power, government data show.

Key figures such as Pony Ma, chairman of Tencent Holdings , have been lobbying for Hong Kong’s closer integration into southern China’s Greater Bay Area, the base of some of the country’s biggest tech companies, such as Huawei Technologies and ZTE Corp, besides Tencent.

Sky-high rents and a lack of risk appetite have often been blamed for the bleak technological entrepreneurial landscape in Hong Kong, even though it is home to world-class universities, a thriving financial sector and Asia’s wealthiest tycoons.

Hong Kong earmarked HK$50 billion ($6.4 billion) in February for the development of the technological sector.

This month it rolled out a pilot fast-track visa scheme for eligible firms in areas from artificial intelligence to biotech to recruit research and development staff from mainland China and overseas.

Promoting science and technology cooperation between Hong Kong and China is part of the implementation of the “one country, two systems” principle, Xi said.

But his call to support scientists that “love the country and love Hong Kong”, has raised a few eyebrows in the former British colony returned to China in 1997, where some fear funding decisions will bring political screening by Beijing.

Asked if academic freedom might be affected, Hong Kong leader Carrie Lam told reporters that some commentators had “read too much” into the term, which she called a natural word choice by Xi, rather than a precondition for receiving funding. ($1=6.3565 Chinese yuan renminbi) (Reporting by Sijia Jiang and Tina Ge; Editing by James Pomfret and Clarence Fernandez)

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