LCQ14: Funding schemes that support technology enterprises
17.5.2023

Following is a question by the Hon Jimmy Ng and a written reply by the Secretary for Innovation, Technology and Industry, Professor Sun Dong, in the Legislative Council today (May 17): Question: The Government provides support for technology enterprises through a number of funding schemes, which include the Incubation Programme and Incu-bio Programme. However, as at February this year, the success rates of applications for these two programmes were only 56 per cent and 54 per cent respectively. Moreover, the success rate of applications for the Cyberport Creative Micro Fund (CCMF) was as low as about 15 per cent in the past three years. In this connection, will the Government inform this Council: (1) of the respective numbers of applications received and approved by the authorities since the launches of the Incubation Programme and Incu-bio Programme, as well as the respective average amounts of funding granted to the approved applications; (2) of the respective numbers of applications for CCMF received and approved by the authorities in each of the past five years, and whether all the approved applications were granted a cash grant of $100,000 in each case; (3) whether it has taken the initiative to look into the reasons for the low success rates of applications for the aforesaid schemes; if so, of the details; of the number of small and medium enterprises assisted by SME ReachOut set up by the Trade and Industry Department in applying for the aforesaid schemes in each of the past two years; whether SME ReachOut will step up its efforts to assist applicants in applying for the aforesaid schemes in the future, with a view to increasing the success rates of applications for such schemes; if so, of the details; and (4) whether it will consider raising the amounts of funding to be granted under the aforesaid schemes; if so, of the details; if not, the reasons for that? Reply: President, The Hong Kong Science and Technology Parks Corporation (HKSTPC) and Cyberport, as Hong Kong's innovation and technology (I&T) flagships, have been committed to providing start-ups with infrastructure, incubation programmes and one-stop support. They provide pre-incubation support for entrepreneurial technology talent through various incubation programmes, including subsidised office space and shared facilities, financial aid packages, technical and management assistance, promotion and development assistance and business support. Having consulted the Commerce and Economic Development Bureau, our reply to various parts of the question is as follows: (1) The HKSTPC launched the Incubation Programme and the Incu-Bio Incubation Programme in July 2021 to provide incubatees with subsidies capped at around $1.3 million and $6 million respectively. As at end-March 2023, the two programmes received 465 and 48 applications respectively, of which 332 and 28 were approved. Incubatees will receive the aforementioned $1.3 million and $6 million subsidies as long as they have fulfilled the pre-set milestones within the relevant periods of the programme. (2) The number of applications and intake for the Cyberport Creative Micro Fund (CCMF) in the past five years are set out below: Financial Year Number of Applications Number of Intake 2018-19 851 97 2019-20 804 98 2020-21 731 97 2021-22 636 97 2022-23 598 98 Note: Withdrawn applications are not included. Successful CCMF applicants will be eligible for the $100,000 subsidy upon achievement of the pre-set milestones and completion of projects within six months, during which the applicants are required to submit interim and final reports. The grant will be disbursed in stages upon the achievement of pre-set milestones by the applicants as indicated in their reports. (3) The HKSTPC and Cyberport will assess applications from start-ups based on criteria such as the competence of the applicant enterprise's management team and potential of the business plan, etc., and then pass the applications to the respective independent assessment panels for consideration. Overall speaking, applications which were not approved commonly lack a unique technology product/solution or development potential. Applicants may make reference to comments from the assessment panel in revising their proposals for resubmission. On the other hand, small and medium enterprises (SMEs) can obtain information on the above mentioned funding schemes at the four SME centres (i.e. the Support and Consultation Centre for SMEs of the Trade and Industry Department, the SME Centre of the Hong Kong Trade Development Council, SME One of the Hong Kong Productivity Council and TecONE of HKSTPC). Moreover, SME ReachOut has also referred SMEs to the secretariats of the above-mentioned funding schemes (i.e. the HKSTPC and Cyberport) for enquiries about application matters. The breakdown of the statistics on the referrals for the various funding schemes is not available. Furthermore, the Financial Secretary announced in the 2023-24 Budget that $100 million would be allocated to enhance the services of SME ReachOut in the next five years, including arranging visits to more chambers of commerce, commercial and industrial buildings and co-working spaces, increasing the publicity in social media so as to step up the promotion of government funding schemes, while at the same time providing more one-on-one consultation sessions. (4) Over the years, the HKSTPC and Cyberport have been offering suitable assistance to start-ups at different stages of development and will review the operation of their programmes/funds in a timely manner, with a view to exploring the feasibility of enhancing the relevant arrangements.