6 key takeaways for HK marketing community from Budget 2025

Talent acquisition, tourism development, and artificial intelligence (AI) and technological innovation are among the main goals for Hong Kong in the upcoming year, as outlined in the latest Budget 2025.

During an opening speech delivered at LegCo, Hong Kong’s finance chief Paul Chan stated that Hong Kong’s economy has grown 2.5% in 2024. Moreover, the number of visitors increased by about 30% to around 45 million last year. Total exports of services grew by 4.8% for the year. 

Despite a tight labor market, the unemployment rate remained low at 3.1%. Chan said that the Hong Kong economy faces external challenges, including ongoing geopolitical tensions and trade protectionism. However, there are also several positive factors. The government predicts that Hong Kong's economy will continue to grow moderately this year, with an expected increase of 2% to 3% in real terms.

Hence, this is still a deficit budget, which is expected to result in a consolidated deficit of HK$87.2 billion for the fiscal year 2024‑25. Fiscal reserves are expected to be HK$647.3 billion by 31 March 2025.

Looking ahead to 2025‑26, the government will continue to provide resources for consolidating momentum on economic growth, promoting the accelerated development of I&T industries, and enhancing public services.  It will also increase capital works expenditure to cater for the Northern Metropolis (NM) and other public works projects relating to the economy and people's livelihood, so as to support the sustained economic development of Hong Kong.

Below, MARKETING-INTERACTIVE lays out some of the key takeaways from the Budget 2025 that businesses and marketers in Hong Kong should focus on.

1. Attracting enterprises, capital and talents

Since its establishment, the Office for Attracting Strategic Enterprises (OASES) has attracted 66 strategic enterprises, 80% of which have established or planned to establish their global or regional headquarters in Hong Kong. 

In addition, Invest Hong Kong (InvestHK) successfully attracted over 500 mainland and overseas enterprises to set up or expand their businesses in Hong Kong last year, representing an increase of over 40%  These enterprises are expected to bring in direct investment of over HK$67.7 billion.

OASES will announce a new batch of more than 10 strategic enterprises next month.  Together with those previously announced, they will invest a total of about HK$50 billion in Hong Kong and create more than 20,000 jobs over the next few years.

Striving to attract enterprises from the mainland and around the world to set up headquarters or corporate divisions in Hong Kong, the government has also submitted a bill to the Legislative Council (LegCo) for the introduction of a company re‑domiciliation.

Regarding capital attraction, total deposits in Hong Kong reached over HK$17 trillion by the end of last year, reflecting a year-on-year increase of 7%. In efforts to attract capital from emerging markets, two exchange-traded funds tracking Hong Kong stocks were listed on the Saudi Exchange last year, with assets exceeding HK$13 billion.

Nurturing talents

In terms of attracting talent, by the end of last year, various talent admission schemes have received a total of over 430,000 applications and approved more than 270, 000, bringing some 180,000 talents to Hong Kong.

The World Tourism Cities Federation (WTCF)'s 2025 WTCF Fragrant Hills Tourism Summit (二零二五年世界旅遊城市聯合會香山旅遊峰會) will be held in Hong Kong for the first time in April.  The summit is expected to attract representatives from some 40 countries and regions.

In attracting quality talents and professionals, the government will shortly invite top and leading talents to come to Hong Kong for development under the Quality Migrant Admission Scheme (優秀人才入境計劃).  It will also enhance the Admission Scheme for Mainland Talents and Professionals and the General Employment Policy by allowing young non‑degree talents with professional and technical qualifications and experience to come to Hong Kong to join skilled trades facing manpower shortage.

To stimulate interest in I&T among primary and secondary students, the government has invited the Hong Kong Investment Corporation (香港投資管理有限公司) (HKIC), HKSTPC, and Cyberport to coordinate over 100 technology enterprises. They will engage students through product displays and site visits, sharing experiences in AI, robotics, and green technology.

The government is also encouraging technology enterprises in Hong Kong to provide resources, technical guidance and practice scenarios for technology education such as coding and AI learning in schools, with a view to further enhancing young people's interest and capability in I&T application through integrating theoretical learning and practical application

2. Positioning AI as a core industry

While the government has been enhancing the strategy and planning on AI development, the first-phase facility of Cyberport's AI Supercomputing Centre (人工智能超算中心) has just commenced operation, and the computing power will be ramped up gradually to 3,000 petaFLOPS this year. This is equivalent to the processing capacity of nearly 10 billion images in an hour.

To spearhead and support Hong Kong's innovative research and development (R&D) as well as industrial application of AI, the government has set aside HK$1 billion for the establishment of the Hong Kong AI Research and Development Institute (香港人工智能研發院).  The Digital Policy Office (DPO) will formulate the establishment arrangements of the institute and its specific goals, focusing on facilitating upstream R&D, midstream and downstream transformation of R&D outcomes and expanding application scenarios.

To bring together top talents in the industry to study the development and application of AI, HKIC will be hosting the first International Young Scientist Forum on Artificial Intelligence (國際人工智能青年科學家論壇) to promote research of AI technology and its development as an industry. 

HKIC will also host the first International Conference on Embodied AI Robot (國際機器人大會) to pool together top‑notch technology enterprises, academic institutions and investors to showcase the latest R&D outcomes and application scenarios, thereby boosting Hong Kong's global influence on technology areas.

In terms of AI application, the government plans to launch the two-year Pilot Manufacturing and Production Line Upgrade Support Scheme (Manufacturing+) (製造及生產線『升』級支援先導計劃)this year.  It will provide funding of up to HK$250,000 on a one-to-two matching basis to support Hong Kong enterprises in developing smart production strategies and integrating advanced technologies. A total of HK$100 million has been allocated for the scheme, benefiting around 400 enterprises.

3. Empowering industry development through technology

Chan said the Greater Bay Area (GBA) plays an important strategic role in the national scientific and technological innovation system. The government will develop a medium- to long-term plan for new industrialisation in Hong Kong and establish a HK$10 billion Innovation and Technology Industry-Oriented Fund (創科產業引導基金) to attract market capital for emerging and strategically important industries. Relevant organisations are invited to submit expressions of interest, with plans to seek funding approval from LegCo in mid-year.

When it comes to development of low-altitude economy, the interdepartmental Working Group on Developing Low-Altitude Economy (發展低空經濟工作組), established late last year, is reviewing applications for the first batch of regulatory sandbox pilot projects, with results to be announced soon. Through these projects, the government aims to expand low-altitude flying activities and create new growth opportunities for Hong Kong's economy.

The government is also reviewing civil aviation legislation to improve regulations for the long-term development of the low-altitude economy. Proposed amendments to the Small Unmanned Aircraft Order (小型無人機令) will be introduced to LegCo in the second quarter. Additionally, the government will consider dedicated legislation for various types of Advanced Air Mobility (先進空中運輸系統) and enhance coordination with mainland authorities on low-altitude economy issues.

Additionally, the government will provide local technology companies with more physical displays and sales environments for their products. The Hong Kong Trade and Development Council (HKTDC) will add a thematic pop-up display area at the flagship retail platform Hong Kong Design Gallery (香港‧設計廊) and exhibition venues during major exhibitions to showcase high-quality innovative technology products to both local and overseas buyers or consumers.

4 Enhancing tourism industry promotion

While tourism boosts local economic development and creates employment opportunities, the government will continue to attract and support the staging of international or large‑scale arts and cultural events in Hong Kong through the Mega Arts and Cultural Events Fund (文化藝術盛事基金), with a view to promoting the development of Hong Kong as an East‑meets‑West centre for international cultural exchange. It has updated the assessment criteria to require funded events to help promote tourism and bring economic benefits.

The inaugural Hong Kong Performing Arts Expo (香港演藝博覽) concluded in October last year, featuring over 1,600 arts leaders and practitioners from more than 60 countries and regions. The government will organise the second edition of the expo next year, transforming the event into a flagship of its arts and cultural industries

In terms of cultural intellectual property, the government will support cultural IP creators and producers to propel more than 30 cultural IP projects cumulatively in the coming five years. It is also fostering more cross-sectoral collaboration within the cultural and creative sectors so as to enhance the communication power and sales value of cultural IP products.

For the tourism industry, the government will allocate HK$1,235 million to the Hong Kong Tourism Board (HKTB) in the coming year. This funding aims to promote the idea that "tourism is everywhere" and to implement the development blueprint for Hong Kong's Tourism Industry 2.0 (香港旅遊業發展藍圖2.0).

The HKTB will collaborate with more international brands to tell the good stories of Hong Kong's tourism.  For example, the HKTB signed a three-year global strategic partnership agreement with Art Basel to establish immersive experience zones of Hong Kong culture in all four annual Art Basel shows around the world, strengthening Hong Kong's connection with the global art scene. The government will also step up efforts to promote a series of distinctive tourism products such as eco‑tourism, panda tourism and horse-racing tourism to enrich travel experiences in Hong Kong.

The HKTB will continue to support the staging of more meetings, incentive travels, conventions and exhibitions in Hong Kong, which are expected to bring about 183,000 additional visitor arrivals and spending of about HK$1.4 billion.

In collaboration with the HKTB, the government will make extra efforts to develop markets in the Middle East and ASEAN to attract more high‑end visitors.  The government is encouraging various sectors of the community to enhance tourism‑support facilities, such as providing worship facilities in hotels and stepping up staff training to strengthen the industry's understanding of the visitors' different cultural backgrounds.

The HKTB will also enhance the one‑stop travel information platform, Discover Hong Kong to provide a "Live Travel Map" (實時旅遊地圖) and a "Smart Itinerary Planner" (人工智能行程規劃) to provide visitors with more comprehensive and personalised itinerary suggestions, travel information and offers.

Mega event economy

The government will continue to promote and publicise Hong Kong as a mega events capital globally, attract more tourists to Hong Kong and enhance their tourism experience during their stay.

Kai Tak Sports Park (KTSP) is the largest‑ever sports infrastructure in Hong Kong with the 50,000-seat Stadium.  Large scale sports and entertainment events will be held in the Park, thereby driving visitation and spending.

The government has been supporting the staging of major international sports events in Hong Kong through the "M" Mark System.  It will adopt a more strategic approach in continuously attracting sports events which can bring significant economic benefits to Hong Kong, and are in discussion with LIV Golf which has been held in Hong Kong for two consecutive years to explore long-term partnership. 

Leveraging harbourfront resources

Chan said the government is making every effort to enhance the harbourfront on both sides of the Victoria Harbour. The eastern section of the Boardwalk, the Hung Hom Urban Park (Phase 2) and the open space at Eastern Street North in Sai Ying Pun will be completed this year.  It will set up refreshment stalls at harbourfront locations in Central, Wan Chai, North Point and Tsim Sha Tsui this year to enrich visitor experience.

Moreover, the fovernment has invited the MTR Corporation to conduct a study to develop the waterfront and former pier sites to the south of Hung Hom Station into a new harbourfront landmark.  It will include iconic commercial and residential developments, retail, dining and entertainment facilities, as well as yacht club for promoting yacht tourism.  We will put forward land use proposals in the middle of this year.

5. Supporting local enterprises

To support the development of local enterprises and help them go global, the government will inject HK$1.5 billion in total into the dedicated fund on branding, upgrading and domestic sales and the export marketing and trade and industrial organisation support fund, and streamline application arrangements.  

Meanwhile, Chan said many banks have joined the SME lending taskforce established by HKMA and the Hong Kong Association of Banks, committing to flexible arrangements to alleviate cash flow burdens on SMEs. Funds allocated for SME financing in these banks' loan portfolios have recently surpassed HK$390 billion.

To further support local SMEs in accessing the mainland market and boosting eCommerce sales, HKTDC will launch the "eCommerce Express"  (電子商務快車) in collaboration with major eCommerce platforms, offering one-to-one consultations and thematic seminars. HKTDC will also enhance its mentorship scheme with the Trade and Industry Department. Additionally, HKTDC will organise the second edition of the Hong Kong Shopping Festival (香港好物節).

6. Advancing virtual asset developing 

Chan said the government has been actively developing the virtual asset ecosystem in Hong Kong in recent years. The government will soon promulgate a second policy statement on the development of virtual assets to explore how to leverage the advantages of traditional financial services and innovative technologies in the area of virtual assets, enhance thesecurity and flexibility of real economy activities, and encourage local and international companies to explore the innovation and application of virtual asset technologies. The government will conduct consultations this year on the licensing regimes of virtual asset over-the-counter trading services and custodian services.

The government has also introduced into LegCo a bill to put in place a regulatory regime for issuers of fiat-referenced stablecoins.  Upon the passage of the Bill, the HKMA will expedite the vetting of licence applications.

Related articles:

Survey: Over 80% of APAC CMOs expect an increase in budget allocations for 2025
How HK brands can maximise ROI with limited budget in 2025
6 key takeaways for the HK marketing community from Budget 2024