With a crystal ball in one hand and a shovel in the other, Chief Executive John Lee Ka-chiu is raring to shape Hong Kong’s development for the next five years.

The crystal ball is the special administrative region’s first five-year development plan, while the shovel is his policy in getting the job done. On Wednesday, he delivered both to the eagerly waiting people of Hong Kong.

By presenting the SAR’s five-year plan to dovetail with the national 15th Five-Year Plan (2026-30), Lee has elaborated to both his constituency in Hong Kong and the central authorities in Beijing the direction that Hong Kong is heading.

Key to his master plan is the development of the Northern Metropolis, an ambitious multibillion-dollar high-tech development along the boundary with neighboring Shenzhen, and the advent of artificial intelligence in the Hong Kong workplace.

Hong Kong is strategically positioning itself as a global AI leader, particularly by aligning with its role in the Guangdong-Hong Kong-Macao Greater Bay Area and the nation’s broader technological ambitions.

In the Legislative Council chamber, Lee explicitly outlined the SAR government’s commitment to fostering AI development and application across various sectors, recognizing its transformative potential for economic growth and societal well-being.

The region’s AI strategy is multifaceted, encompassing research and development, talent cultivation, industry application, and robust governance frameworks. A key pillar of this strategy is research-and-development investment. Hong Kong aims to significantly increase its R&D expenditure as a share of GDP, targeting 3 percent after 2030. This financial commitment is designed to fuel innovation in core technology areas, including life and health technology, AI and robotics, microelectronics, new energy, advanced manufacturing, and new materials. Establishing and expanding innovation parks like the Loop in the Northern Metropolis and the Hong Kong Science Park are crucial to this effort, serving as hubs for cutting-edge research and collaboration between local and international institutions.

Talent cultivation is another critical aspect. Hong Kong has a strong foundation, with several top-ranked universities actively engaged in interdisciplinary programs involving emerging industries. Hong Kong is home to several world-class universities, with four institutions now ranked among the global top 50 and five in the top 100, according to the latest QS World University Rankings 2027.

According to Lee, the government is committed to nurturing high-caliber AI talent through enhanced training frameworks, expanded postgraduate research places, and initiatives like the Hong Kong PhD Fellowship Scheme. The goal is to attract and retain leading minds in AI, ensuring a continuous pipeline of skilled professionals for both academia and industry.

In terms of industry application, Hong Kong envisions widespread AI adoption across its key sectors. This includes finance, healthcare, legal services, construction, transport, social welfare, tourism, and broadcasting. The government is actively supporting small and medium-sized enterprises in integrating AI into their operations through enhanced digital transformation support pilot programs and increased funding. Specific initiatives include leveraging AI for fraud detection in the financial sector, accelerating drug discovery and medical device development through AI-powered clinical trials, and optimizing urban management through an “AI City Brain” integrated system for real-time data analysis and emergency response.

However, AI’s rapid advancement also brings inherent risks. Hong Kong is taking a proactive stance on AI governance, focusing on mitigating potential downsides while maximizing benefits. This includes addressing concerns about deepfake technology, online scams, and the ethical use of AI. The government is studying regulations, expanding legal frameworks to combat fraudulent content, and promoting market assessment of AI ethical risks. Guidelines on AI agent management are being developed, and discussions are underway to examine legal liabilities arising from AI-product-related accidents. The impact of AI on employment is also being closely monitored, with measures planned to upskill and reskill the workforce to adapt to evolving job markets.

Furthermore, Hong Kong aims to foster international collaboration in AI. This includes working with renowned universities and tech parks globally, participating in international bodies, and showcasing Chinese AI standards. The SAR is also leveraging its role in the Greater Bay Area to promote cross-boundary development, facilitating the flow of personnel, materials, capital, and data to create a comprehensive AI industry chain.

In essence, Hong Kong’s AI strategy is ambitious and comprehensive. It seeks to leverage the city’s strengths in research, finance, and international connectivity to become a leading hub for AI innovation and application. By combining a substantial R&D investment, a focus on talent development, widespread industry adoption, and a robust governance framework, Hong Kong is charting a course to harness AI’s full potential for a prosperous and resilient future.

The author is a former chief information officer of the Hong Kong government, a public-relations and media consultant, and a veteran journalist.

The views do not necessarily reflect those of China Daily.