A Supportive Government

Hong Kong will capitalise on the opportunities arising from the national Belt and Road Initiative and the Guangdong-Hong Kong-Macao Bay Area development proactively and holistically. The government shall play the role of a “facilitator” and “promoter”.

Key initiatives announced in the 2021-22 Budget include:

Support Enterprises

• Extend the application period of 100% guarantee low-interest loan for enterprises to the end of this year, raise loan ceiling to $6 million, extend repayment period and duration of principal moratorium
• Reduce profits tax for 2020-21 assessment year by 100%, subject to a $10,000 ceiling
• Provide rates concession for non-domestic properties in 2021-22, subject to a ceiling of $5,000 per quarter in first two quarters and $2,000 per quarter in remaining two quarters
• Waive business registration fees for 2021-22
• Continue to waive 75% of water and sewage charges of non-domestic households for 8 months, subject to a monthly ceiling of $20,000 and $12,500 respectively
• Continue to grant 75% rental/fee concession for eligible Government properties/short-term tenancies and waivers for 6 months (100% concession for those closed at the Government’s request)

Reviving the Economy

• Issue $5,000 electronic consumption vouchers in instalments
• Inject $1.5 billion into the Dedicated Fund on Branding, Upgrading and Domestic Sales, increase funding ceiling per enterprise to $6 million and extend its geographical coverage in phases
• Allocate $375 million to Hong Kong Trade Development Council (HKTDC) to enhance its capability to organise online activities and to proceed with digitalisation
• Develop the business version of the “iAM Smart” digital authentication platform
• Explore the development of the Hong Kong Legal Cloud

Tourism, Cultural and Creative Industries

• Earmark $169 million to continue to take forward local cultural, heritage and creative tourism projects
• Earmark $765 million to support Hong Kong Tourism Board (HKTB) in reviving the tourism industry
• HKTB to conduct a comprehensive review of the positioning of Hong Kong’s tourism in the long run, formulate strategies to spur industry’s recovery
• Consider reviving local group tours provided that public health can be safeguarded, allowing room for industry’s business operation
• Discuss and work out Air Travel Bubble arrangement with suitable places
• Inject an additional $1 billion into the CreateSmart Initiative

Financial Services

• Issue no less than $24 billion of Silver Bond and no less than $15 billion of iBond this year. Lower the eligible age for Silver Bond subscription from 65 to 60
• Issue green bonds totalling $175.5 billion within the next 5 years, and plan to issue retail green bonds
• Roll out Green and Sustainable Finance Grant Scheme to subsidise expenses on bond issuance and external review services
• Strive for the launch of Southbound Trading of Bond Connect within this year, and enhance the domestic Central Moneymarkets Unit
• Provide subsidy for Real Estate Investment Trusts to list in Hong Kong
• Launch a Pilot Insurance-linked Securities Grant Scheme to subsidise issuance costs
• Provide subsidy for Open-ended Fund Companies to set up in or re-domicile to Hong Kong
• Review tax arrangements relevant to family office business

Innovation and Technology

• Earmark over $200 million to roll out “Knowing More About IT” Programme, subsidise primary schools to enhance students’ interests and knowledge in I&T and their applications through extra-curricular activities
• Regularise the pilot scheme which subsidises students studying science and technology in local universities to enrol in short-term I&T related internships
• Inject $9.5 billion into the Innovation and Technology Fund by two yearly instalments
• Hong Kong Monetary Authority to consider enhancing its Fintech Supervisory Sandbox to reduce time for launching innovative financial products in the market
• Press ahead with the development of the Hong Kong-Shenzhen Innovation and Technology Park in the Lok Ma Chau Loop
• Continue to implement the Science Park expansion and Cyberport 5 development
• Continue to support the development of 5G networks and applications
• Commence progressively the operation of the first batch of about 20 R&D laboratories under the “InnoHK Research Clusters” in the first quarter of this year

Air Cargo Sector

• With the expansion of the existing express air cargo terminal, the commissioning of a new premium logistics centre and the Three Runway System, annual cargo handling capacity of Hong Kong International Airport (HKIA) is expected to increase to some 9 million tonnes in 2024
• Explore measures to facilitate trans-shipment through Hong Kong, so as to maintain Hong Kong’s competitive edge as an international air cargo hub
• Redevelop the Air Mail Centre at HKIA to become operational by end 2027 at the earliest

Key economic initiatives announced in the 2020 Policy Address include:

International Financial Centre

• Include the pre-profit biotechnology companies listed in Hong Kong and stocks listed on the Mainland Sci-Tech Innovation Board meeting certain prescribed criteria into the stock universe of the mutual market access programmes
• Expedite the implementation of the GBA cross-boundary wealth management connect scheme
• Promote real estate investment trusts (REIT) in Hong Kong, including considering a relaxation of the investment restrictions of REIT as appropriate and broadening the investor base, as well as providing tax concession for carried interest issued by private equity funds
• Launch the Fintech Proof-of-Concept Subsidy Scheme to encourage traditional financial institutions to partner with start-ups to conduct Proof-of-Concept projects
• Conduct public consultation on the establishment of a licensing regime to monitor virtual asset service providers
• InvestHK will set up a dedicated team to step up promotion of our advantages in local and other major markets, and offer one-stop support services to family offices which are interested in establishing a presence here

International Aviation Hub

• The Airport Authority Hong Kong (AAHK) will invest in Zhuhai Airport on the basis of market principles to reinforce its advantage in aviation
• To consolidate and enhance the development of the airport city, AAHK will develop innovative facilities on the Hong Kong Boundary Crossing Facilities (HKBCF) Island of the Hong Kong-Zhuhai-Macao Bridge (HZMB), including automated car parks, the Intermodal Transfer Terminal, the Airport City Link connecting the airport, the SKYCITY and the HKBCF Island via the autonomous transportation system and extend it to the Tung Chung Town Centre later
• Commence preparation work for cross-boundary commercial helicopter services

International Innovation and Technology Hub

• Jointly develop the Shenzhen-Hong Kong Innovation and Technology Co-operation Zone with Shenzhen, and explore with Shenzhen government the idea of allowing the Hong Kong Science and Technology Parks Corporation to lease and manage certain areas of the Innovation and Technology Zone in Futian, Shenzhen, before the completion of the first batch of research and development (R&D) buildings in the Hong Kong-Shenzhen Innovation and Technology Park at the Lok Ma Chau Loop
• Launch a five-year Global STEM Professorship Scheme at a cost of $2 billion to attract outstanding R&D talent from overseas to engage in R&D work in Hong Kong
• Release the Smart City Blueprint for Hong Kong 2.0 in December 2020 with more than 130 smart city initiatives
• Launch the iAM Smart one-stop service platform in December 2020 for the delivery of a number of government and public utility electronic services

Supporting Business and Commerce Development and Small and Medium Enterprises

• Expand the scope of subsidy under the Small and Medium Enterprises Export Marketing Fund for two years so that enterprises affected by the epidemic can fully utilise both online and offline sale channels
• Set aside $50 million under the Professional Services Advancement Support Scheme to subsidise professional bodies to step up publicity and promotion in the GBA and overseas
• Establish the Pan-Greater Bay Area Inward Investment Liaison Group to enable InvestHK and its counterparts in other cities in the GBA to develop holistic and joint inward investment propositions with a view to enhancing synergy

Creative Industries

• Make an additional injection of $1 billion into the CreateSmart Initiative
• Set up an inter-bureau task force to promote and develop Art Tech, set aside $100 million and provide state-of-the-art venues and complementary facilities for experimental use

Construction Industry

• Maintain an annual capital works expenditure of over $100 billion in the next few years, creating over 300,000 employment opportunities for the construction industry taking into account investment from the private sector
• Propose to the Legislative Council to raise the expenditure ceiling for each minor works project funded under the block vote from the current $30 million to $50 million to expedite the implementation of projects that are closely related to the daily lives of the people

Convention and Exhibition Industry

• Take forward the redevelopment of the three government towers in Wan Chai North and the Kong Wan Fire Station into convention and exhibition facilities, hotels and offices, and press ahead with the development of phase two of AsiaWorld-Expo
• Make use of the $1 billion Convention and Exhibition Industry Subsidy Scheme to subsidise exhibitors of exhibitions organised by the HKTDC and participants of its major conventions

Tourism Industry

• Roll out additional relief measures involving a funding of $600 million for the tourism industry, which has been hardest hit by the epidemic
• Tap into more local cultural and green tourism resources once the epidemic has eased, with a view to expanding both the Mainland and overseas visitor source markets as well as offering leisure and travel experience with rich historical and cultural elements

The Government of Hong Kong SAR is also committed to driving local business through a variety of initiatives. For details of government funding schemes, please visit here.