While Hong Kong has been pondering and debating about what to do and how to behave in the emerging NewSpace area, as opportunities have not just been knocking on our door but have been beating their fists for our attention, our brethren over the border in Guangdong province have seized the initiative, just as our recent Policy Address has finally stepped up to the plate in this area.
Guangdong recently unveiled a set of game-changing policies to support the NewSpace economy while a sea change is also now percolating through Hong Kong with new explicit support in the fresh Policy Address. Guangdong has implemented 21 measures to promote the high-quality development of commercial space. Furthermore, these policies are backed up by real resources and substantial financial support. The measures are spread across seven major categories that are focused on addressing key aspects of commercial space development. These include infrastructure, industrial application, market entities and the investment and financing mechanisms to enable the province to seize the rapidly emerging strategic opportunities for commercial ventures like satellite-based internet.
I am as impressed as I am covetous of what was recently announced as they seek to develop a complete, fully integrated, NewSpace ecosystem. It’s intended to cover the entire value chain, from rocket launches to satellite and payload research and development, manufacturing, space-to-ground data services, and everything else in between. It’s ambitious, comprehensive, systematic, well argued, detailed and compelling in equal measure. Now Hong Kong too has begun to implement such forward-thinking vision for policies in this area!
So as Guangdong powers ahead, Hong Kong can also seize its moment by leveraging its many advantages to create high-tech, high-value, space-centered ventures. Of course, there are risks, and space capital and programs can be a risky proposition. However, the rewards are clearly there as the global value of the NewSpace economy amply demonstrates. This is across a market rapidly growing and valued conservatively at about $630 billion in 2023 but projected to exceed $1.8 trillion by 2035, according to the World Economic Forum.
With its newly announced NewSpace policies, fresh off the press, the Hong Kong Special Administrative Region government I am sure will carefully examine Guangdong’s policies with urgency, strong evaluation and with a view to cooperative and constructive engagement.
Hong Kong is lagging, but the right policies, now emerging and enacted as soon as possible, can make a real difference. They will enable us to play a major role in the nation’s exciting and rapidly developing commercial and increasingly international space ecosystem. Let’s go
With new policy backing, Hong Kong “astropreneurs” and investors can now more confidently step up and enter Guangdong’s rapidly developing NewSpace ecosystem while also simultaneously developing our own local version. I believe we can play a major role of considerable value to the Chinese mainland’s NewSpace development. We should seek to cooperate, collaborate, contribute and even compete where prudent to do so. There is plenty of opportunity to go round as recognition of the importance of this area, coupled as it is to low-altitude economy initiatives, finally dawns. Then — and this is key — we can confidently seize opportunities before they pass by or are grabbed by others.
A primary focus of both Guangdong’s and Hong Kong’s policy initiatives is that provincial and municipal support will be offered to enterprises to increase their R&D spending. In Guangdong, this includes programs such as providing a 100 percent pre-tax deduction to enable companies to quickly strengthen their R&D efforts in the necessary core technologies and cutting-edge innovation platforms that will enable them to accelerate development and market their applications in the NewSpace ecosystem.
Another focus is on encouraging engagement with international commercial opportunities for the NewSpace enterprises that will be emerging. Again, Hong Kong as a truly global city, can play its superconnector card here. Guangdong offers valuable rewards and financial incentives to companies that offer monetizable services to overseas customers and we can do the same. Coupled with all of this are special Guangdong terms to support investment and corporate financing — again areas where Hong Kong excels — with channels that include such instruments as insurance premium compensation. This is to encourage risk-taking and instill a very Australian “let’s have a go” attitude alongside a “nothing ventured, nothing gained” mentality that I miss so much, living in what at times seems a quite risk-averse Hong Kong. A final comment on Guangdong’s comprehensive plans, which are far too detailed to provide more than a cursory summary of here, is about their talent nurturing initiatives that are strongly echoed in the chief executive’s new Policy Address. These include strengthening recruitment policies to attract overseas talent and entire teams, implementing better ways to nurture homegrown talent, and supporting the establishment of research institutes, vocational colleges and professional talent streamlined for NewSpace activities. We are now dovetailing nicely!
What can and should Hong Kong’s enterprises, institutes, universities and talent do now that a NewSpace sea change is afoot? We must combine our business acumen, financial and investment expertise, and strengths in legal frameworks, compliance and regulation together with the R&D excellence of our universities, into a powerful, integrated nexus under our own Hong Kong Space Office. Furthermore, our world-class universities that embody rapidly developing basic space research strengths, such as at the University of Hong Kong, the Hong Kong University of Science and Technology and the Hong Kong Polytechnic University in particular, can combine to create an interconnected, interdisciplinary framework that avoids silo mentalities. Hong Kong has the collective capacity to tackle fundamental space and planetary science challenges, space sustainability issues and leverage R&D capacity for the NewSpace economy to grow prosperity, jobs, internationalization and impact.
We can implement a combined strategy to cross-train scientists, technologists and STEM (science, technology, engineering, and mathematics) “astropreneurs” to answer deeply challenging scientific, technological and commercial questions across NewSpace R&D focuses. With strong leadership we can create a lasting legacy of impactful NewSpace policies that can learn from Guangdong and elsewhere but with a Hong Kong-specific and global vision. This would include engaging regulatory, legal and compliance expertise for R&D in NewSpace and space sustainability.
Hong Kong is lagging, but the right policies, now emerging and enacted as soon as possible, can make a real difference. They will enable us to play a major role in the nation’s exciting and rapidly developing commercial and increasingly international space ecosystem. Let’s go!
The author is director of the Laboratory for Space Research at the University of Hong Kong.
The views do not necessarily reflect those of China Daily.
