Social and economic activities over the past few years have been greatly affected by political disturbances around the world and COVID-19. Friction between China and the United States has been escalating, hitting the global supply chain. Meanwhile global economic development has also slowed down because of the Russia-Ukraine conflict, which has lasted for more than a year.
All of these negative factors have put unprecedented pressure on China’s work over the past five years. Nevertheless, as the Government Work Report delivered at the opening of the first session of the 14th National People’s Congress pointed out, the country’s development within a complex global environment has basically achieved its targets, including 3 percent growth in GDP in 2022.
Within such a complex global political and economic environment, it is crucial to national security for China to possess the ability to innovate independently and grasp advanced technologies, which is one of the objectives of the national 14th Five-Year Plan (2021-25). Therefore, I suggested during the two sessions that Hong Kong should accelerate the development of its innovation and technology sector and transform the city into an international innovation and technology hub with a robust high-tech ecosystem. As the city’s international innovation and technology center takes shape, the Hong Kong Special Administrative Region’s accelerated integration into the Guangdong-Hong Kong-Macao Greater Bay Area will give full play to Hong Kong’s research and development strengths and serve the needs of the country’s economic development.
Over the past five years, against all odds, the central government has focused on and achieved numerous important tasks, including sustaining economic expansion within a reasonable range with innovative macro-control measures, winning the battle against poverty as per schedule and consolidating and expanding the achievements on poverty alleviation, deepening reform and opening-up, enhancing market vitality and social creativity, implementing innovation-driven development strategies, promoting the optimization and upgrading of industrial structure, promoting coordinated regional development and a new type of urbanization, ensuring national food security and vigorously implementing the rural revitalization strategy, and deepening win-win international economic and trade cooperation. Measures to boost employment and improve people’s livelihoods were also implemented. In 2022, 12.06 million new jobs were created in cities and towns nationwide, with the surveyed urban unemployment rate declining to 5.5 percent.
Within such a complex global political and economic environment, it is crucial to national security for China to possess the ability to innovate independently, … I suggested during the two sessions that Hong Kong should accelerate the development of its innovation and technology sector and transform the city into an international innovation and technology hub with a robust high-tech ecosystem
Moreover, in the past five years, the central government vigorously promoted scientific R&D with the goal of gaining the ability to innovate independently. The Chinese mainland’s ratio of R&D expenditures to GDP increased from 2.14 percent in 2018 to 2.56 percent in 2022. (Hong Kong’s ratio in this respect in 2021 was 0.97 percent.) In summary, in upstream R&D, the funding for national basic research has doubled over the last five years.
In many major scientific fields, including human space flight, lunar exploration and fire detection, deep sea and deep earth exploration, supercomputing, satellite navigation, quantum information, nuclear technology, artificial intelligence, etc, China has made fruitful achievements, and many of those R&D projects have involved the HKSAR’s academics.
In the midstream, the central government has increased the proportion of the weighted pre-tax deduction of R&D expenses of scientific and technological enterprises, with some enterprises enjoying 100 percent deductions; the central government has also introduced various tax incentives to support innovation with an annual scale of trillions of dollars, and strengthened the protection of intellectual property rights. All of these measures are intended to promote R&D application in the industrial and commercial sectors.
On the downstream side, the central government promoted the healthy development of the platform economy, giving full play to its role in promoting employment and entrepreneurship, expanding the consumer market, and innovating the production model. In the past five years, the added value of the technology and equipment manufacturing industries has increased by 10.6 percent and 7.9 percent annually respectively. The digital economy has been growing, with the added value of new industries and business models accounting for over 17 percent of GDP. Riding the wave of scientific R&D, Hong Kong, the nexus that bridges the mainland with the rest of the world, is also expecting an outburst of high-tech players, especially unicorns, in the chip, artificial intelligence and digital industries.
The new-term central authorities are expected to strive for the nation’s continuous socioeconomic development and the realization of Chinese-style modernization under the spirit of the 20th National Congress of the Communist Party of China. Innovation and technology development is undoubtedly among the top priorities of the new administration.
The author is a Hong Kong member of the National Committee of the Chinese People’s Political Consultative Conference; a Legislative Council member; associate dean (External Affairs), Faculty of Engineering, the Chinese University of Hong Kong; and vice-president of the Hong Kong Professionals and Senior Executives Association.
The views do not necessarily reflect those of China Daily.