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Fostering Creativity and Innovation, 
Moving Towards High Value-added Industries

38.      As Hong Kong gradually transforms into a knowledge-based economy, our industries need to embrace new concepts, break with tradition and move towards higher value-added outputs. The Government will proactively encourage research and development, innovation and design to help our industries move up the value chain. We will focus on helping them switch the production mode from Original Equipment Manufacturing to Original Design Manufacturing and thence Original Brand Manufacturing. To enhance its competitiveness, we provide support to the industrial sector through, for example, the provision of competitively-priced land and comprehensive standards and accreditation services. In addition, we are actively promoting Hong Kong brand names to overseas and Mainland businesses and providing loan and support schemes tailor-made for small and medium enterprises.

39.      Whether it is in films, from "Buddha's Palm" to "A Better Tomorrow" to "Infernal Affairs"; in graphic fiction, from "Master Q" to "My Boy" to "McMug"; or in trend-setting jewelry, watches, fashion and other innovative product designs, the creative industries of Hong Kong have won worldwide recognition and achieved many outstanding successes. Our performing arts sector has gained a foothold in Hollywood. Moreover, CEPA has opened up the vast Mainland market to our film industry. We will continue to promote creative industries and uphold our robust protection of intellectual property rights, providing an environment for creative, innovative and high value-added industries to flourish.

40.      Design is the soul of a product. A good design can thoroughly remould our business, and significantly augment the competitiveness of our products and services. To encourage more product design activities in Hong Kong and further promote Hong Kong brand names, we need to strengthen our support for design and innovation. We plan to launch a "DesignSmart" initiative with the creation of a $250 million fund. Apart from nurturing start-up design ventures and training manpower in design and branding, it will promote and honour design excellence. The initiative also includes setting up a Design and Innovation Centre in order to attract design talent from different places. Through these efforts, we seek to instil into our industries high value-added, high intellectual property and creativity content. We also wish to turn Hong Kong into a focal point of design excellence in the region.

41.      We will seek funding support from the Finance Committee of this Council later. In addition, to facilitate this promotional initiative, we will extend the profits tax deduction for research and development expenses to cover expenses on design-related activities. The relevant legislation will be introduced into this Council as soon as practicable.

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2003 | Important notices
Last revision date : 10 March, 2004