The Changing Role of the State in High-Tech Industrial Development: The Experience of Hong Kong

Abstract

This paper is an examination of the role of the Hong Kong government vis-à-vis governments in Japan and other Asian newly industrialized economies (NIEs) in high-tech industrial development. It is argued that, whereas governments of Japan and other Asian NIEs have played very important roles in facilitating industrial restructuring, the Hong Kong government has so far refrained from direct participation in industrial development. Although the Hong Kong government has assumed an important position in the course of economic development in the territory, especially in terms of land-related economic activities, it has little vested interest and experience in directing industrial developments. It was not until the 1990s that the government switched from a ‘positive nonintervention’ to a ‘minimum intervention with maximum support’ industrial policy and began to play a more active role in facilitating industrial upgrading. The effectiveness of the changing industrial policy and the prospects for high-tech development in the territory are reviewed by examining the challenges and opportunities faced by the Hong Kong government in facilitating high-tech industrial development.