HKPC announces the key findings on the “Hong Kong AI Industry Development Study”

49% of AI enterprises expressing difficulties in recruiting technical expertise HKPC offers 9 main suggestions for establishing Hong Kong as a well-recognised “Worldwide AI and Information Trade Growth Hub”

HONG KONG SAR – Media OutReach – 10 November 2023 – Hong Kong Productiveness Council (HKPC) launched the important thing findings on their “Hong Kong AI Trade Growth Examine” right this moment, specializing in the standing of Hong Kong’s synthetic intelligence (AI) {industry} growth, home and abroad competitors and native company utility. HKPC additionally supplied 9 main suggestions for establishing Hong Kong as a well-recognised “Worldwide AI and Information Trade Growth Hub”.

As one of many highlights of “2023 Coverage Handle”, the HKSAR Authorities has acknowledged “AI and information science” as one of many three focuses of latest industrialisation growth. Upon receiving LegCo funding a number of years in the past, Hong Kong now hosts 14 cross-industry AI analysis laboratories and three universities rating on this planet’s prime 30 universities with AI-related topics and analysis, the HKSAR Authorities will even set up a “Digital Coverage Workplace” to speed up the development of a high-performance computing (HPC) information centre, which is slated to finish in 2024-2025 and is already steadily making use of AI expertise into its public companies. As a way to construct Hong Kong into an “AI and Information Trade Growth Hub”, how ought to enterprises and governments reply? In gentle of this, HKPC collaborated with the Hong Kong Institute of Economics and Enterprise Technique (HIEBS), HKU Enterprise Faculty at The College of Hong Kong to conduct a “Hong Kong AI Trade Growth Examine” in mid-2023 to discover the assorted wants, alternatives and challenges the {industry} is at present dealing with. A complete of 216 AI-related enterprises participated within the survey, and the important thing findings of the analysis are as follows:

Overview of the event of Hong Kong’s AI {industry}: 49% of contributors expressed encountering difficulties in recruiting technical expertise

Among the many AI ​​enterprises interviewed, 25% are giant corporations, and 75% are small and medium enterprises (SMEs). Of those, 17% mentioned they’re creating in any respect three ranges (primary layer, expertise layer and software layer), and 22% mentioned they intend to increase their growth to different layers sooner or later. 55% of the businesses want to broaden their companies into each worldwide and native markets. Compared, 14% and 11% of corporations will select to focus their companies in Hong Kong and the Mainland, respectively.

Monetary overview:

• 51% of huge corporations acknowledged that they’re at present worthwhile, with 31% of general enterprises claiming to be worthwhile.
• Funding sources: 43% of corporations report receiving funding from the HKSAR Authorities, whereas 19% acquired funding from enterprise capital/angel buyers.
• Cumulative funding quantity: 49% of corporations invested lower than HK$1 million, whereas 21% invested between HK$1 million and HK$5 million, 6% of corporations invested between HK$5 million and HK$10 million, 5% of corporations invested between HK$10 million and HK$100 million, and 4% of corporations make investments over HK$100 million.

Trade growth overview:

• 48% of corporations are solely creating AI for one {industry}, whereas 16% of corporations goal two industries and 15% of corporations goal three industries on the similar time.
• Focused industries: 29% telecommunications and data expertise companies, 24% medical/scientific and well being tools, well being merchandise, prescribed drugs, 23% schooling, nurturing/coaching, 22% manufacturing, and 21% Authorities organisations.
• Foremost sources of earnings: 63% from Hong Kong, 19% from the Mainland, and 15% from abroad.

Present main challenges within the {industry} – inadequate HPC processing energy and information, and difficulties in recruiting technical expertise:

• Inadequate processing energy: 44% of enterprises specific having difficulties securing sufficient processing energy, and 71% cowl the shortfalls by cloud computing companies, of which 31% select HPC information centres within the Mainland whereas 26% select HPC information centres abroad.
• Inadequate information: 44% of corporations are having difficulties amassing information, and 16% say it takes a very long time to gather ample information. In the meantime, 8% reported that they don’t have any related information.
• Recruitment difficulties: 49% of corporations are having difficulties recruiting, and a few even diminished their hires of technical expertise in Hong Kong. 77% of corporations reasoned that it is because of Hong Kong’s excessive working prices, and 41% expressed that Hong Kong lacks related technical expertise. Nonetheless, 45% of corporations nonetheless plan to extend the hiring of Hong Kong technical expertise.

Overview of home and abroad AI ​​{industry} growth: Governments worldwide are selling the event of AI-led industries.

Within the Mainland, the Chinese language Authorities is actively selling the event of AI, and the AI {industry} has already reached important scale. Whereas Shenzhen’s Pengcheng Cloudbrain II’s HPC pc capabilities have efficiently reached world-class degree, Shanghai has additionally been setting up The Shanghai Supercomputer Heart (SSC). Moreover, each cities have issued regulatory measures and insurance policies to advertise the event of AI {industry}, overlaying key parts akin to human assets, HPC processing, information, algorithms, main analysis, software eventualities, {industry} chains, industrial park service techniques, fund teams, and servicing commonplace techniques. With the Authorities taking lead in implementing AI, Shanghai focuses on industries akin to manufacturing, finance, and transport, whereas Shenzhen focuses on public companies and concrete governance.

For the abroad market, Singapore launched its “Nationwide AI Technique” in 2019, specializing in the interplay amongst Authorities, {industry}, academia and analysis sectors, in addition to expertise and information, with assets concentrated in areas akin to finance, Authorities, healthcare and logistics. Singapore locations particular emphasis on nurturing native AI expertise and helps the appliance of AI in native SMEs. Their AI Apprenticeship Program offers native expertise with abilities coaching and hands-on alternatives with a good month-to-month allowance. The Singapore Authorities additionally offers AI readiness index evaluation companies, matching funding with tasks, platform engineering groups, HPC cloud clusters, and so forth. for SMEs to advertise their AI purposes.

As a world monetary centre, New York offers a superb financing ecosystem and setting for AI corporations in the USA, and is house to a number of top-tier analysis centres for AI tech giants. The New York Metropolis Authorities can also be dedicated to constructing a wholesome AI ecosystem and proceed to discover extra alternatives for public sector purposes of AI and safeguard residents’ digital rights. In the meantime, Switzerland’s important investments in analysis and schooling have created a first-class progressive setting for native AI growth. The nation has nurtured world-class progressive universities such because the Swiss Federal Institute of Know-how Zurich, giving rise to native AI star corporations and attracting quite a few top-tier world expertise corporations to determine a presence within the nation. These collaborations between private and non-private establishments have made important contributions to AI expertise analysis and industrialisation of analysis outcomes, which in flip drives growth of AI in Switzerland.

Concluding the state of affairs in numerous areas, Governments worldwide have applied insurance policies to create a beneficial growth setting for AI to thrive. These traits point out that AI has turn into a key focus for Governments around the globe.

Overview of Hong Kong enterprises’ software of AI: 41% of Hong Kong enterprises are utilizing or will use AI

To know the general state of affairs of Hong Kong enterprises’ use of AI, this research has additionally collected extra information from 267 corporations, of which 81% had been SMEs, and 19% had been giant corporations, overlaying a number of industries, together with retail and catering, private companies, {and professional} service industries. Of all corporations surveyed, 41% are or can be utilizing AI, with 32% of them already making use of the expertise in a number of ranges, akin to advertising (58%), operations (44%), and inside administration (33%). The typical cumulative funding in AI has reached HK$830,000. For the remaining 9% of corporations getting ready to combine AI expertise into their enterprise operations, their common funding funds is roughly HK$140,000. When it comes to plans to broaden using AI, 59% of corporations which have already built-in AI acknowledged that they may additional broaden their AI purposes and improve their funding. 61% of them are contemplating to broaden their funding by HK$300,000, and the common anticipated extra funding quantity is as excessive as HK$1.22 million.

Mr Edmond LAI, Chief Digital Officer of HKPC, mentioned, “As a scientific analysis establishment, HKPC has robust expertise in AI purposes and sensible capabilities in creating AI. We’re dedicated to selling the event of the AI ​​{industry} and have efficiently developed related applied sciences as we help enterprises in upgrading and reworking their companies. In line with the most recent information, 49% of corporations which have utilized AI imagine that its results are in keeping with their expectations, and 14% even identified that their funding have even exceeded their expectations. Nonetheless, a small variety of corporations even mentioned that their AI purposes might have extra work to realize the focused results. By means of this helpful information analysis, HKPC goals to additional promote the appliance of AI throughout numerous industries, serving to companies optimise their operations and manufacturing processes, improve effectivity, cut back prices, and facilitate the event of the AI {industry} in Hong Kong whereas offering sensible suggestions.”

Professor TANG Hei-wai, Affiliate Director of HIEBS, concluded that, “AI has empowered the event of 1000’s of industries and introduced in big development potential to the financial system. This analysis centered on the AI insurance policies and growth of 5 distinctly completely different international locations/areas: Singapore, New York, Switzerland, Shanghai and Shenzhen, and we have now found that every one regional Governments have launched particular insurance policies and measures to create a fostering growth setting for AI applied sciences. Amongst them, Shenzhen even proposed to cooperate with Hong Kong to construct an AI HPC centre. As well as, the report additionally displays {that a} good variety of Hong Kong enterprises intend to additional develop their AI companies or apply AI. The HKSAR Authorities can consult with the expertise of different areas and analyse the present challenges confronted by native enterprises to formulate focused incentive measures to make sure that our metropolis can seize the alternatives that AI brings. By injecting new impetus into the post-epidemic and digital financial system, we will improve our industries and create new alternatives.”

Through the years, HKPC has made exceptional achievements in analysis and growth (R&D) of AI applied sciences and promoted the event of AI ​​{industry}. Mr Edmond LAI continued, “HKPC established the Hong Kong Industrial Synthetic Intelligence and Robotics Centre (FLAIR) on the Hong Kong Science & Know-how Parks Company, devoted to utilising AI to drive productiveness by combining technical experience, community, progressive R&D and patents. As the only real founding establishment, we have now collectively operated FLAIR with our accomplice, RWTH Aachen Campus in Germany, through the years. After years of exhausting work, FLAIR has turn into a member of HKSAR Authorities’s world-class progressive platform ‘AIR@InnoHK’. Along with cooperating with worldwide analysis establishments and key {industry} gamers, with the objective to help enterprises in establishing AI purposes, and successfully supporting Hong Kong’s growth into a world innovation and expertise centre, FLAIR additionally developed the ‘Hephaestus: Industrial Synthetic Intelligence Utility Platform‘, enabling {industry} professionals to retailer and entry information storages, AI mannequin storages and generate codes from their subsequent industries’ database to develop, prepare and use numerous AI applied sciences. HKPC will proceed to advertise the event of progressive applied sciences, help new industrialisation in Hong Kong, and promote Hong Kong’s rise as an ‘Worldwide AI and Information Trade Growth Hub’. As a way to obtain this, we have now put ahead 9 suggestions of their core segments, which can hopefully enhance infrastructure growth, speed up industrialisation and broaden our AI expertise pool.”

9 suggestions to promote Hong Kong’s growth as an “Worldwide AI and Information Trade Growth Hub”