Can Hong Kong afford to jump on the mainland Chinese tech bandwagon?
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President Xi Jinping's recent criticism of local governments for blindly pursuing hot industries like artificial intelligence and new energy vehicles should serve as a wake-up call for Hong Kong. The warning highlights the risk of
'involution' or vicious competition, especially if Hong Kong simply takes 'industrial diversification' to mean following mainland trends.
In recent years, Hong Kong has promoted innovation and technology, yet a closer examination reveals a concerning sameness. Although the
Northern Metropolis and Cyberport appear to focus on diverse areas – life sciences, microelectronics, Web3 – they often mirror similar innovation corridors on the mainland.
Xi's question – of whether all provinces in the country have to develop the same few industries – might also be asked of Hong Kong.
Given that Hong Kong is spending a lower share of its gross domestic product on R&D and that these resources are spread across multiple fields, the city is less likely to achieve breakthroughs in these areas. In the meantime, as mainland provinces strengthen their industrial chains, Hong Kong's role as a connector may diminish.
The Central Urban Work Conference Xi presided over also proposed improving the efficiency of existing capacity and assessing debt risk, ideas that could apply to Hong Kong.
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