Hong Kong’s Attitude Problem with Smart City Development

On the surface, Hong Kong has all the necessary pre-requisites to be a smart city leader.

Deep mobile penetration, excellent infrastructure, burgeoning logistics environment, strong university facilities and a growing entrepreneur economy with new venture capitalist cash pouring in every day.

The HKSAR Government is also adding its weight. It developed a smart city blueprint and noted its willingness to invest HKD 700 million in three areas: eID, a pilot Multi-functional Smart Lampposts scheme and improving its e-government systems.

The government also earmarked US$50 billion for innovation and technology projects over the past year, according to the HKSAR Government Office of Government Chief Information Officer (OGCIO) -- an amount that 43 percent of CIOs in a Robert Half study said will increase IT jobs.

So where are the self-driving buses? Why did only 30 percent of residents and corporations consider Hong Kong as a smart city, according to version 2.0 of Google Hong Kong's Smarter Digital City Whitepaper? And why is Hong Kong ranked behind Tokyo and Singapore in smart city development?

The problem does not lie at the infrastructure level. High smart mobile penetration, good network infrastructure, robust power lines, and robust data center facilities make the city a good testbed for smart city development.

Instead, it is at the people level where change needs to begin. Simply put, Hong Kong residents and corporations do not see the value behind smart cities.

While 14 percent think the government is significantly investing in making Hong Kong a smarter city, down one-third from 21 percent in 2017, they are not asking for better e-services either. They also pointed to inadequate research and development and technological talent development as other reasons in the Google white paper.

The Robert Half study highlighted that 92 percent of CIOs feel it is more challenging to recruit qualified IT professionals than five years ago. Ninety-five percent also think that the talent shortage will restrict company growth.

"This year's Smarter Digital City findings show that more work needs to be done to accelerate the city's digital transformation. Consumer digital engagement remains low, while local small-and-medium business' digital adoption lags behind our nearest neighbors, and there is also a widening talent gap to address [in order] to meet the demands of digital transformation," said Leonie Valentine, managing director, Sales & Operations, Google Hong Kong.

A big part of the problem is the resident attitude. Most Hong Kong children undergo rigorous education with a focus on law, medicine and finance. "It is critical for Hong Kong to build a strong talent pipeline, by embracing STEM education, promoting digital literacy and providing vocational training to help the workforce get prepared for the digital economy," said Valentine.

“The government, business community and educational institutions must come together to find ways to tackle the skills shortage, such as increasing the influx of local candidates, making it less challenging to bring in foreign talent and marketing IT as an attractive career path. Local businesses also need to focus more on professional development and training of existing staff to fill crucial skill gaps within their own organization. Increased government investment within the IT sector will no doubt go a long way in facilitating such initiatives,” added Adam Johnston, managing director, Robert Half Hong Kong. 

But all is not doom and gloom. In two areas, Hong Kong residents show promise in smart city development and can help to spur the city to be a leader.

One lies in our aging population. The Google white paper noted that the consumer digital index score had a significant uptick in the age 55-64 category. That means the older generation is picking up technology at a faster rate. Startups can develop and test apps that are targeted at the aging population and create solutions for other Asia Pacific cities that have an aging population.

Also, 80 percent of Hong Kong residents said that they want to improve their digital skills. More surprising is what they want to improve: machine learning, app development and data analytics. These are vital areas where corporates are searching for talent.

All we now need is the willpower to embrace a digital lifestyle. Here the government has a fleeting opportunity to create the opportunity for app and platform development for an expectant public, learning from similar initiatives in other smart cities.

Will they seize the opportunity? We need to watch the upcoming policy address closely.