Advancing Hong Kong’s innovation landscape: trailblazing new industrialisation

In a strategic move to become Asia’s innovation hub, Hong Kong is enhancing its efforts to attract start-ups and innovators. The Hong Kong Chief Executive’s 2023 policy address revealed a visionary plan, featuring the establishment of a New Industrialisation Development Centre backed by a HK$10 billion (US$1.3 billion) New Industrialisation Acceleration scheme. The measures are aimed at supporting leading innovators in the field of sustainable smart manufacturing, optimising and upgrading industrial chains in Hong Kong and the Greater Bay Area (GBA).

Spearheading this initiative, Hong Kong Science and Technology Parks Corporation (HKSTP) has transformed industrial estates into dynamic “InnoParks” in Tai Po, Yuen Long and Tseung Kwan O. This commitment marks a crucial turning point in propelling the city’s manufacturing sector towards a new era of creativity and technological advancement.

Simon Yeung, co-founder and chief operation officer, Time Medical, a leading enterprise in the medical imaging sector, is overseeing the first large-scale medical equipment production facility in Hong Kong. This 30,000 sq ft MRI production plant boasts advanced technologies, seamless logistics support and a tightly integrated manufacturing environment.

“Hong Kong, once an industrial hub, witnessed the expansion of many industries to mainland China and Southeast Asia,” Yeung says. With the government’s support in fostering new industrialisation, he says his company can benefit from tax-free importation policies and harness a pool of highly educated talent to streamline the end-to-end processes of research and development (R&D), design, production and sales for its paediatric products. “This showcases our prowess as one of the premium ‘Hong Kong brands’, delivering cutting-edge medical imaging solutions to the global market,” he says.

Formerly reliant on manual processes, Time Medical has optimised operations by integrating automated sensors and cutting-edge devices. “This transition not only enhances intelligent data collection, but also significantly reduces the duration of the quality control process from four to five days to an impressive two to three hours.

“Hong Kong possesses unique advantages in the research and development and ‘innofacturing’ of high-value-added medical equipment,” Yeung says, adding that HKSTP has been instrumental in supporting the development of the company’s production lines focusing on new-generation neonatal and breast screening MRI systems in the Mars Centre at Tai Po InnoPark.

Time Medical is also seeking support from InnoPark for its brain imaging MRI. “The ultra-high field MRI for brain imaging has the potential to revolutionise early detection of brain degeneration, allowing for the observation of pathological changes 10 to 20 years before symptoms manifest,” Yeung says.

“However, this project necessitates a substantial 150,000 sq ft area and the engagement of more than 100 talents to initiate successfully. With the introduction of new initiatives, we hope the government will consider providing space in the Northern Metropolis or Lok Ma Chau Loop, coupled with additional funding programmes. Our goal is to commence the project by 2025, contributing to the advancement of Hong Kong’s innovation landscape.”

Making significant strides in new industrialisation, some companies are successfully merging artificial intelligence (AI) technologies with traditional processes. Catalo Natural Health Group has spearheaded the establishment of a 30,000 sq ft smart manufacturing facility with a ceiling height of 15 metres in Tai Po InnoPark. It will serve as a model of smart production in Hong Kong with the aim of expanding into mainland China and overseas markets.

“Over the years, our group has been producing high-quality natural health foods and supplements in the United States,” says Calvin Chan, chairman and CEO of Catalo. “Faced with transportation challenges during the pandemic, we decided to revamp our automatic production line to facilitate future expansion of the smart supply chain. With assistance from the government and HKSTP, we established Asia’s first Natural Health Food Smart Manufacturing Facility in Hong Kong.

The city has numerous outstanding research projects awaiting commercialisation, so some researchers are encouraged to develop their own brands with the government’s funding scheme. “In alignment with government efforts in developing R&D innofacturing, Catalo actively contributes to fostering innovation among technology and industrial pioneers,” Chan says, adding that he believes the new government initiatives will encourage collaboration between innovators and entrepreneurs. “It is geared towards leveraging Hong Kong’s technological innovations, utilising mature corporate brands and tapping into established sales channels to export these achievements worldwide.”

Catalo’s entire industrial chain – from product formula development to supply chain management and smart warehousing – is closely monitored using AI. These unmanned production lines reduce resource consumption and cut pollution by 50 per cent, reducing production cycles by the same amount.

Chan also highlights the advantages of having manufacturing facilities in Hong Kong, facilitating collaborations in R&D with local universities and research institutions. These efforts involve clinical experiments, proven natural branded ingredients and patented techniques in the development of new products.

Catalo’s collaboration has extended to local start-ups, resulting in the establishment of Hong Kong’s first smart production line and intelligent warehouse. The company has more than 10 unmanned production lines that can produce over 680,000 individually packaged items per day, with an annual production capacity of 32 million units. In addition, with a floor-to-ceiling 3D storage arrangement and AI-powered inventory management, the warehouse boosts operational efficiency to unprecedented levels. With the integration of intelligent robots and algorithms provided by tech enterprises from HKSTP’s ecosystem, a highly efficient goods-to-person picking model is achieved, further enhancing outbound efficiency.

Chan says Hong Kong’s position in the mainland China market is a key factor for local enterprises that benefit from Hong Kong’s membership of the GBA and the Mainland and Hong Kong Closer Economic Partnership Arrangement (CEPA). “To align with the dual circulation development pattern in mainland China, we are able to employ AI and cutting-edge technologies to develop a series of personalised health food products, enhancing their value and efficacy by capitalising on the strengths of the ‘Hong Kong brand’,” he says.

HKSTP is committed to upgrading its InnoParks, which currently support more than 180 innovation enterprises. This year, it will open ProShop – a hi-tech, smart manufacturing facility to support R&D, prototyping and testing at the Advanced Manufacturing Centre (AMC) in Tseung Kwan O InnoPark – and the Microelectronics Centre (MEC) at Yuen Long InnoPark. The two facilities will boost the development and pilot production of new-generation microelectronics products and further strengthen the government’s drive towards advanced manufacturing and new industrialisation.