Nearly two years after the Hong Kong Investment Corporation (HKIC) was established, the government-owned fund has completed an inaugural partnership agreement with SmartMore, a home-grown artificial intelligence (AI) start-up that specialises in applying AI automation and optics to spot advanced production line product defects.
Tasked with developing Hong Kong’s innovation and technology (I&T) ecosystem by identifying investment opportunities and strategically promoting target industries, the HKIC’s activities are a departure from the government’s long-established practice of a mainly hands-off approach to direct involvement in business ventures. Notably, the HKIC carries a dual mandate, which seeks ‘reasonable financial returns’ while enhancing the long-term competitiveness of Hong Kong’s I&T industries.
Domestic focus
Unlike sovereign funds administered by South Korea, the United Arab Emirates and Singapore, which mainly invest outside of their own territories , the HKIC’s goals are primarily focused on supporting the domestic market, which includes leveraging capital to encourage technology companies globally to use Hong Kong as their development base. Supporters of the initiative believe that this market-enabling philosophy will help to grow the Hong Kong economy by creating new industries, transforming existing ones and creating high-skilled jobs.
Investment themes will focus on hardware technologies, life sciences and new energy technologies
Through strategic investment and partnerships, the HKIC outlines its role as ‘aggregating and channelling resources to support I&T development in Hong Kong through revitalising innovation and development in relevant industrial chains, both vertically and horizontally’. Investment themes will focus on hardware technologies, life sciences and new energy technologies. Hardware technologies, for example, include AI, data science and semiconductors, while the life sciences category includes the medical diagnosis, instruments and pharmaceuticals that can be utilised in both Chinese and Western medicine.
Building research
While the HKIC, which manages HK$62bn (US$8bn), has not revealed how much it has invested in SmartMore, one of the cornerstones of the agreement requires the start-up to establish Hong Kong’s first AI research institute covering upstream and downstream industrial chains, as well as cultivating talent and boosting the Special Administrative Region’s (SAR) computing power level. With a client list that includes Apple, Tesla, BYD and Airbus, SmartMore has been valued at over US$1bn. Touted as one of Hong Kong’s first unicorn successes, it is understood that if SmartMore decides to seek a stock market listing the company would prioritise Hong Kong’s bourse. However, the company says it has no immediate plans to initiate a public offering.
HR practitioners highlight the need to focus on soft skills development
Further underscoring Hong Kong’s aspirations for enriching its I&T ecosystem, the HKIC has entered into an agreement with Beijing-headquartered biotech start-up BioMap to set up an accelerator hub in Hong Kong to support around 50 early-stage life-science R&D projects. The BioMap accelerator hub is expected to focus on cutting-edge life science projects, with a priority given to ones recommended by Hong Kong universities and relevant stakeholders.
To sustain Hong Kong’s bridging role between mainland China and the rest of the world, amid the push to accelerate the SAR’s I&T capabilities, HR practitioners are highlighting the need to focus on soft skills development, such as problem-solving, collaborative working, creativity and cultural intelligence to strengthen people-to-people interactions.
