With the 2026-27 Budget officially announced, Hong Kong’s innovation and technology policy has entered a clear strategic shift. Under the national 15th Five-Year Plan, this year’s budget is no longer focused only on early-stage “seeding.” Through large-scale capital injection, including major Northern Metropolis funding, and top-level institutional innovation, the government is pushing technology outcomes toward real economic productivity.
The following four policy directions will shape Hong Kong’s innovation and technology landscape over the next five years.
“AI+” Across Industries: From Computing Power to Smart Governance
Artificial intelligence is no longer just a laboratory technology. The government is pushing AI into the real economy and public administration.
At the top decision-making level, the Financial Secretary will chair the newly established AI+ and Industry Development Strategy Committee. Its first application targets include life and health technology and embodied intelligence.
Computing infrastructure is also being put in place. Hong Kong’s total computing power has reached 5,000 PetaFLOPS. The tender result for the Sha Ling Data Park in the Northern District is expected to be announced soon, providing 250,000 square metres of important physical space.
For enablement and transformation, HKD 100 million will be allocated to promote digital intelligence inside the government and improve public service efficiency with AI. Another HKD 50 million will support public organizations and technology companies in organizing AI application courses and competitions to improve society’s digital literacy.
On talent and organization, the Hong Kong AI Research and Development Institute will begin operating in the second half of the year. The Employees Retraining Board will also be upgraded into the Skills Upgrading Authority to promote skills-based AI application training.
Northern Metropolis: Major Funding to Start Physical Growth
The Northern Metropolis has moved from planning into implementation. This year, the government is injecting significant seed capital.
The Hetao Hong Kong Park will receive HKD 10 billion to accelerate infrastructure, facility operations, and the establishment of a dedicated venture capital fund. The government is also working to enable cross-boundary movement of research data and biological samples.
For San Tin Technopole, a dedicated company will be established for coordination, with an application for HKD 10 billion in initial funding to support the arrival of major industries.
The budget also encourages public-private collaboration. Developers that own land are encouraged to partner with technology companies and submit joint development proposals to the government, helping speed up land release.
New Industrialization: Building National-Level Pilot Production Platforms
To address the gap between strong research and weaker production capabilities, the government is strengthening national-level certification and resources on the production side.
About HKD 220 million has been reserved to establish Hong Kong’s first overseas National Manufacturing Innovation Centre, filling an important midstream commercialization gap.
In microelectronics, the Hong Kong Microelectronics Research and Development Institute’s pilot line will begin operating in Yuen Long this year. It will also work with HKIC to establish the Hong Kong RISC-V Alliance and promote the open-source chip ecosystem.
The New Industrialization Elite Enterprise Cultivation Scheme will also be launched to support high-growth hard technology companies expanding in Hong Kong.
Frontier Technology and Patient Capital
Hong Kong is also trying to develop future industries with global competitiveness beyond its traditional strengths.
In the low-altitude economy and aerospace sectors, the first regulatory sandbox projects are already being tested. A drone traffic management system will be launched in the first half of the year. The government will also identify leading aerospace enterprises to come to Hong Kong, while HKEX will optimize listing rules to support aerospace technology company financing.
A HKD 10 billion Innovation and Technology Industry-Oriented Fund will be established by the government, focusing on strategic industries such as life and health technology, AI, and data science.
HKIC has already shown strong leverage, with every HKD 1 invested attracting HKD 8 in long-term capital. The government will continue to replenish funding as needed so this patient capital can support long-term enterprise growth.
Enterprise Opportunities Under Policy Support
Looking across the 2026 Budget, the government’s strategy is clear: infrastructure first, capital guidance, and application landing.
For businesses, whether traditional industries are seeking AI transformation or hard technology startups are looking for funding, this is a strong moment to make use of policy support. Hong Kong is moving from a pure financing centre toward an innovation and technology hub powered by both research and manufacturing.
The government is no longer only a funder. It is becoming a guide and investor. From AI computing power to new quality productive forces, Hong Kong is trying to move from being a research station on the global innovation map to becoming a complete industry hub.
For I&T startups and traditional businesses planning transformation, this is a timely opportunity to use policy momentum and accelerate digital upgrading.
Translation supported by AI.