Following is a question by the Hon Edward Leung and a written reply by the Secretary for Financial Services and the Treasury, Mr Christopher Hui, in the Legislative Council today (November 13):
 
Question:
 
     The 2024 Policy Address has proposed that the Government would strive to collaborate with sovereign wealth funds in regions along the Belt and Road to further enhance Hong Kong's status as an international asset and wealth management centre. There are views pointing out that apart from proactively soliciting funds from overseas market to enter the local market, the Government should also play a leading role in encouraging local investments to give priority to the local market, thereby attracting overseas capital to enter the local market. In this connection, will the Government inform this Council:
 
(1) whether it knows currently the respective amounts and percentages of investment placements in the Hong Kong market from foreign exchange reserves under the management of the Hong Kong Monetary Authority, as well as self-managed seed capital funds set up by various tertiary institutions with part of their reserves;

(2) given that according to the information from the Mandatory Provident Fund (MPF) Schemes Authority, as at the end of March this year, total MPF assets amounted to $1.183 trillion, whether the Government knows the amount and percentage of investment placement in the Hong Kong market from such assets; of the respective amounts and percentages of investment placements in the Hong Kong market from assets held by the top five MPF trustees;

(3) given that according to the data published earlier on by the Insurance Authority, total gross premiums of the insurance industry in Hong Kong amounted to $310.9 billion in the first half of this year, whether the Government knows the amount and percentage of investment placement in the Hong Kong market from such premiums;

(4) as there are views pointing out that if the authorities can take the initiative to make additional investments in the local market, it will bring about a positive stimulating effect on the Hong Kong stock market, whether the authorities will study the formulation of investment instructions for assets under their management to require the allocation of a certain percentage of such assets for investment in the local market; if so, of the details; if not, the reasons for that; and

(5) regarding MPF and insurance premium investments, whether the authorities will study issuing guidelines to the relevant organisations to require the investment of a certain proportion of their assets in the local market, thereby driving capital flow back to the Hong Kong market and injecting more impetus into the local market; if so, of the details; if not, the reasons for that?
 
Reply:
 
President,
 
     In consultation with the Education Bureau, the Hong Kong Monetary Authority (HKMA), the Mandatory Provident Fund Schemes Authority (MPFA) and the Insurance Authority (IA), our reply to the five parts of the question is as follows.
 
(1) As of end-September 2024, the official foreign currency reserve assets of Hong Kong stood at US$422.8 billion.
 
     Under the premise of prudent management of the Exchange Fund to maintain Hong Kong's monetary and financial stability, the HKMA has gradually increased the investment exposure to investment managers with major operations in Hong Kong in recent years so as to encourage the expansion of their businesses in Hong Kong.
 
     On open market investments, the HKMA employs various external investment managers to manage a portion of the Exchange Fund's assets, about 90 per cent of which are managed by investment managers with offices in Hong Kong. Moreover, all Hong Kong stock investments are managed by the local team of about 20 external investment managers. Over the past few years, the Exchange Fund has also invested in 32 local hedge funds through various channels.
 
     On private market investments, the Long-Term Growth Portfolio (LTGP) of the Exchange Fund mainly works with internationally renowned investment managers by appointing them as general partners, of which over 60 per cent have established offices in Hong Kong, including a number of sizable private equity asset managers. While the general partners managing LTGP mainly invest in global or regional assets, the HKMA will continue to support locally-focused investment managers through other investment channels and attract other experienced investment managers to set up offices in Hong Kong.
 
     As regards investments of post-secondary education institutions, the institutions may on their individual considerations adopt appropriate arrangements having regard to factors such as their institutional strategies and specific purposes of the funds concerned. The Government does not collect information on their investment allocation.
 
(2) Under the Mandatory Provident Fund (MPF) System, scheme members may build a suitable investment portfolio taking into account their own investment objective and risk tolerance level. The overall allocation of MPF assets by market and asset class primarily reflects the collective investment decisions made by over 4.7 million scheme members.
 
     As of end-March 2024, statistical information on MPF investments by asset class is as follows:
 
(a) among MPF assets invested in equities, equities with primary listing in Hong Kong had a total value of HK$242.3 billion and a share of 31 per cent (for the five MPF trustees with the largest assets-under-management (AUM) size, the relevant ratios ranged from 20 per cent to 43 per cent);
 
(b) among MPF assets invested in deposits and cash, Hong Kong dollar denominated deposits and cash had a total value of HK $126.8 billion and a share of 94 per cent (for the five MPF trustees with the largest AUM size, the relevant ratios ranged from 90 per cent to 96 per cent); and
 
(c) among MPF assets invested in debt securities, Hong Kong dollar denominated debt securities had a total value of HK $89.8 billion and a share of 35 per cent (for the five MPF trustees with the largest AUM size, the relevant ratios ranged from 18 per cent to 51 per cent).
 
(3) The IA has not requested insurance companies to submit granular data on their global asset allocation strategies, and hence could not provide the relevant information.
 
(4) For the Exchange Fund, its statutory purpose is primarily to maintain the monetary stability of Hong Kong as well as the stability and integrity of the monetary and financial systems, so as to uphold Hong Kong's status as an international financial centre. Similar to other central banking institutions or monetary authorities in the rest of the world, the Exchange Fund needs to hold sizeable and highly liquid foreign exchange reserves, such that it can be used to maintain the financial and monetary stability of Hong Kong when needed. Except for the remnant of Hong Kong equities acquired in 1998 as part of market operations, the Exchange Fund mainly invests in assets outside Hong Kong and does not directly invest in the local market, so as to avoid exerting additional pressure on the local market should there be a need to dispose of some of the Exchange Fund assets for the aforesaid statutory purpose.
 
     The stock market is affected by diverse factors (economic cycle, geopolitical situation, etc.). In the face of challenges from the external environment, the Government is committed to improving market liquidity continuously. Specifically, the Government established the Task Force on Enhancing Stock Market Liquidity last year to comprehensively review factors affecting market liquidity, and put up recommendations on enhancing different aspects including the listing regime, market structure, trading mechanism, etc. The Government and the Securities and Futures Commission as well as the Hong Kong Exchanges and Clearing Limited have progressively implemented measures concerned, and will continue to keep abreast of the changes and needs of the markets in and outside Hong Kong. Medium and long-term directions for market enhancement will be examined, with a view to further strengthening the competitiveness and fostering the sustainable development of the stock market.
 
(5) The MPF System is characterised by the provision of funds investing in different markets and asset classes for scheme members to choose from, such that they could build a balanced and diversified investment portfolio having regard to their own investment objectives and risk tolerance level, thereby achieving investment risk diversification. On the other hand, the IA has requested insurance companies via the Guideline on Asset Management by Authorised Insurers to formulate investment strategies taking into account factors such as their asset/liability relationship, overall risk tolerance level, liquidity needs, etc. Insurance companies allocate their assets, including insurance premium, into different markets and asset classes according to their investment strategies in order to achieve investment risk diversification. The Government has currently no intention to impose limits on the asset allocation of MPF investments and insurance premium investments.

     Following is a question by the Hon Jimmy Ng and a written reply by the Secretary for Education, Dr Choi Yuk-lin, in the Legislative Council today (November 13):
 
Question:
 
     It is learnt that the Government has allocated quite a lot of resources to promote the development of vocational education in recent years, including setting aside some $680 million to support the Vocational Training Council's efforts in extending the Pilot Incentive Scheme to Employers (PISE) and the Pilot Subsidy Scheme for Students of Professional Part-‍time Programmes (Pilot Subsidy Scheme) for five years. In this connection, will the Government inform this Council:

(1) of the respective numbers of employers and trainees participating in the PISE and the number of trainees participating in the Pilot Subsidy Scheme in the 2023/24 academic year, as well as the amounts of subsidies involved, together with a breakdown by industry;
 
(2) whether the PISE and the Pilot Subsidy Scheme will be regularised; if so, of the details; if not, the reasons for that; and
 
(3) whether the subsidy-to-tuition fee ratio of the Pilot Subsidy Scheme will be raised and, at the same time, whether the $36,000 cap on tuition fee subsidy for the creative industries programmes and the health and life sciences programmes will be raised, so as to align with the $45,000 cap on tuition fee subsidy for the construction and engineering programmes?
 
Reply:
 
President,
 
     The Government is committed to promoting vocational and professional education and training (VPET), and, under the strategy of fostering industry‑institution collaboration and diversified development, encourages the co-operation between industries and education and the collaboration between schools and businesses, with a view to providing diversified learning and career opportunities and nurturing more quality talent with applied skills. The Vocational Training Council (VTC) is the largest VPET provider in Hong Kong. The Financial Secretary announced in the 2024-25 Budget that the Government has set aside around $680 million to support the VTC in strengthening its work on VPET, including extending the Pilot Incentive Scheme to Employers (PISE) and the Pilot Subsidy Scheme for Students of Professional Part-time Programmes (Pilot Subsidy Scheme) for five years, stepping up support for student-exchange activities, strengthening assistance to students with special educational needs, and encouraging employers to provide workplace learning opportunities.
 
The reply to the different parts of the question raised by the Hon Jimmy Ng is as follows:
 
(1) With the Government's support, the VTC has implemented the PISE under the Training and Support Scheme since the 2019/20 academic year (AY) to encourage employers to provide trainees with structured workplace learning and assessment, so that the content of training programmes could be more effectively adapted to enhance trainees' work performance. Employers participating in the PISE can receive a subsidy of up to $36,000 (per trainee). In the 2023/24 AY, the numbers of participating employers and trainees under the PISE by industries are as follows:
 

* Due to the diverse nature of the businesses of some employers taking part in the scheme, the above-mentioned employers may engage trainees for different industries at the same time.
 
     As of August 31, 2024, the subsidies involved in the PISE in the 2023/24 AY amounted to around $21 million.
 
     The Government has also implemented the Pilot Subsidy Scheme since the 2016/17 AY to provide tuition fee subsidies (60 per cent of the tuition fees) with a cap of $45,000 per person for practitioners admitted to designated professional part-time programmes offered by the VTC related to the discipline of engineering. From the 2019/20 AY, the Pilot Subsidy Scheme has been expanded to cover VTC's programmes related to creative industries, with a subsidy cap of $36,000 per person. The numbers of participants under the Pilot Subsidy Scheme in the 2023/24 AY by industries are as follows:
 

 
     As of October 31, 2024, the subsidies involved in the Pilot Subsidy Scheme in the 2023/24 AY amounted to around $15 million.
 
(2) and (3) As far as the Pilot Subsidy Scheme is concerned, the tuition fee subsidy levels for different designated courses are different, depending on the respective disciplines of the courses. The Financial Secretary announced in the 2024-25 Budget, the PISE and the Pilot Subsidy Scheme would be extended for five years. The Government will work closely with the VTC and review the effectiveness of the above two schemes, in order to consider their long-term operation and arrangements, including the tuition fee subsidy arrangements of the Pilot Subsidy Scheme.

     The National Security Department (NSD) of the Hong Kong Police Force arrested a 57-year-old man in Hung Hom yesterday (November 12) on suspicion of committing “knowingly publishing publications that had a seditious intention” in contravention of Section 24 of the Safeguarding National Security Ordinance.

     The investigation revealed that the arrested man was suspected of repeatedly publishing posts with seditious intentions on social platforms, with content provoking hatred towards the Central Authorities and the Government of the Hong Kong Special Administrative Region as well as inciting violence.

     NSD today (November 13) morning officially laid charge against a 57-year-old man with one count of “knowingly publishing publications that had a seditious intention”. The case will be mentioned at the West Kowloon Magistrates’ Courts this afternoon.

     Police remind members of the public that “knowingly publishing publications that had a seditious intention” is a serious crime. Offenders shall be liable to imprisonment for seven years on first conviction. Members of the public are urged not to defy the law.

     Following is the speech by the Financial Secretary, Mr Paul Chan, at the 2024 Asia Pacific Investors Cooperation (APIC) World Pension, Social Security and Sovereign Wealth Funds Summit today (November 13):

Ana (Founder and Chief Executive Officer of APIC, Ms Ana Sharp), Ka-shi (Chairman of the Hong Kong Trustees' Association, Ms Lau Ka-shi), Alpha (Director-General of Investment Promotion at Invest Hong Kong, Ms Alpha Lau), distinguished guests, ladies and gentlemen,

     â€‹Good morning. It is a pleasure to be here at the beautiful Hong Kong Yacht Club to join you all for the 2024 APIC World Pension, Social Security and Sovereign Wealth Funds Summit. Delighted to welcome asset owners, public and private fund managers, institutional investors, and key experts in this field from around the world to gather in Hong Kong.

     Pension, social security, and sovereign wealth funds are critical components of the global financial ecosystem. Collectively, these funds manage trillions of dollars in assets, making them one of the largest sources of investment capital worldwide. They are not only investors, but also as key players in shaping market trends and driving economic growth.

Changing landscape of investment

     Allow me to share a couple of observations on the changing investment landscape across the globe.

     The first is the focus on sustainability. At a time when policymakers worldwide increasingly incorporate ESG (environmental, social, and governance) and net-zero commitments into their policy framework, many public funds are seeking to support and drive sustainable development goals, both at home and abroad, such as investing in clean energy, green infrastructure, and affordable housing.

     The second observation is about asset allocation. While public funds normally seek more long-term returns, in the public market, alternative investments are increasingly used as a diversification means to mitigate market volatility risks, with potentially more attractive risk-adjusted returns. As countries seek to support economic development through investing in infrastructure, innovation and technology, or projects of national priorities, more opportunities for alternative investment become available.

     The third observation is about shifting economic gravity and the impact of geopolitics. In recent years, emerging markets such as ASEAN (Association of Southeast Asian Nations) countries have become more popular investment destinations, given their rapid economic growth, young population, expanding middle class, and thus potential for higher returns. Meanwhile, at a time of continuing conflicts and geo-economic fragmentation, some funds from the US (United States) or even Europe have been forced to reduce their investment holdings in certain markets; meanwhile, some countries, like those in the Middle East, are diversifying their investments from the traditional US and European markets to other regions, such as Asia. The process is dynamic, complicated and ever changing.

Hong Kong's value proposition

     â€‹In face of this rapidly changing global investment landscape, I would submit that Hong Kong is where you should allocate your assets.

     In terms of international strengths, Hong Kong enjoys the unique advantages under the "one country, two systems" arrangement. Here is where you could have convenient, and at times, priority access to the vast investment opportunities of China while enjoying all the advantages of a world-class international financial centre.
     
     That means the free flow of capital, goods, people, and talent; the common law and a judiciary that exercises powers independently; a currency pegged to the US dollar; a simple and low tax regime; and regulatory regimes and business practices that align with the best international practices. In other words, a familiar environment to do business and invest.

     â€‹"One country, two systems", let me add, will be here in Hong Kong for the long run. It is a solemn commitment of President Xi Jinping and the country.

     Every now and then, we hear misconceptions about Hong Kong. For instance, there were reports about the outflow of funds from Hong Kong.

     But the facts speak for themselves. Over the years, we have weathered many ups and downs and even crises in the financial market. And we built stronger buffers. Hong Kong's banking system, for example, has a liquidity ratio of over 180 per cent, well above the international requirement of 100 per cent; capital adequacy ratio at 21 per cent, much higher than the 8 per cent requirement. As a matter of fact, bank deposits in the city have risen by over 13 per cent, or US$250 billion, since the beginning of 2022 and until September this year.
     
     â€‹Despite market volatility from time to time, we see global investors gradually restoring confidence in our stock market. In particular, in the stock market rally in late September after the Central Authorities announced a package of stimulus measures, we have seen strong buying interest from American and European investors. They together constituted some 85 per cent of the buy side by value. In terms of investor categories, 90 per cent of them are long-term fund managers and investment banks. 

     Turning to asset and wealth management, Hong Kong is managing over US$4 trillion of assets, with over half of them sourced from outside Hong Kong and the Mainland. That figure represents some 30 per cent increase from that in 2018. Many asset and wealth management firms are expanding their operations in this city. 

Investing in the future of Hong Kong

     Looking ahead, the prospects of Hong Kong remain promising, as we continue to invest in the future of this city with the staunch support of the Central Authorities. And that will present valuable and rewarding investment opportunities for investors from all over the world. Let me highlight a few areas.

     First, our commitment to sustainability. Hong Kong fully embraces the Paris Agreement and has developed clear action plans to achieve carbon neutrality. But our vision goes beyond this. It is our aspiration to become an international green tech and green finance centre that supports regional and global green transition. For this, we have already laid a solid foundation. As Asia’s leading green finance hub, we have on average issued over US$63 billion in green debts annually over the past three years. That accounts for more than one-third of the total amount of green bonds issued in Asia. For green tech, we are home to over 200 green tech firms that offer a wide range of innovative solutions. Many of them have already expanded their operations in overseas markets. 

     Our vision extends to cover sustainable infrastructure. Locally, we are fast tracking a number of large-scale infrastructure projects, including the Northern Metropolis, which will be pivotal to Hong Kong's innovation and technology future. At the same time, we are also committed to supporting sustainable infrastructure projects in other countries, through innovative financing arrangements. For instance, over the past two years, Hong Kong arranged two batches of securitised infrastructure loans amounting to US$800 million. They support more than 50 projects in the Global South. But more than that, we also offer our expertise in the planning, construction, operation, and management of infrastructure projects. Many of our operators, like the Airport Authority and MTRC (MTR Corporation Limited), have been working with their global partners in running projects overseas. 

     Then, there is the Guangdong-Hong Kong-Macao Greater Bay Area (GBA). The GBA, comprising Hong Kong, Macao, and nine Mainland cities in Guangdong Province, is an affluent region with a population of 87 million, and a GDP (Gross Domestic Product) of around US$2 trillion. It is an economic powerhouse of China, home to many tech giants. With the support of the Central Authorities, Hong Kong is enhancing our synergetic collaboration with the GBA, particularly on the tech front. This vision is to turn the GBA into a region led by finance and innovation, one that combines the strengths of the San Francisco Bay Area and the New York Bay Area.

     The third area to highlight is our comprehensive strategy to diversify Hong Kong's economy and raise our competitiveness. Innovation and technology is our handle, and we will focus on four strategic areas, namely, AI (artificial intelligence) and big data analytics, biotech, fintech, as well as new materials and new energy. To expedite development of these sectors, we set up the Office for Attracting Strategic Enterprises towards the end of 2022, proactively reaching out to enterprises from the relevant fields. Together with the efforts of other government departments, we have successfully attracted over 100 innovative enterprises to Hong Kong, which together will bring us more than US$6 billion in investments and create 17 000 jobs. 

     Going hand in hand with our quest for strategic enterprises is our stepped-up effort in attracting talent from all over the world. Our various talent admission schemes have been highly popular. Nearly 400 000 applications have been received so far. We have approved more than 250 000 of them, with more than 160 000 people having already arrived in the city. 

     And a discussion on investing in Hong Kong's future would not be complete without mentioning the Hong Kong Investment Corporation Limited, or HKIC. As "patient capital", the HKIC has been performing the role of channelling private capital and market resources into the above-mentioned strategic industries. Unlike many other sovereign funds, the HKIC has a dual mandate of seeking a reasonable financial return, and more importantly, of enhancing Hong Kong's competitiveness and economic vitality in the long term through strategic investment. Projects concluded by the HKIC include, among others, one using AI for drug discovery process, and another one exporting top-notch EV (electric vehicle) charging solutions to Thailand. We welcome more collaboration with the private market as we drive investments in innovation and technology that would not only generate financial returns but also create tangible benefits for the community and humanity. 

     And speaking of the HKIC, I am glad to report that it will also be hosting a Roundtable for International Sovereign Wealth Funds in January next year where participants could gather to share insights, and explore investment opportunities and develop partnerships. You are more than welcome to join. 

     â€‹Ladies and gentlemen, I hope I have given you some good account about the investment opportunities that Hong Kong offers, and the rewarding returns that could be reaped – not only financially but also socially. I would now be happy to take your questions.

    

     Following is a question by the Hon Jeffrey Lam and a written reply by the Secretary for Culture, Sports and Tourism, Mr Kevin Yeung, in the Legislative Council today (November 13):
 
Question:
 
     There are views that with the completion of "cultural and creative parks" such as the West Kowloon Cultural District, the PMQ, The Mills, in recent years, Hong Kong has successfully shaken off its image as a "cultural desert", and members of the public have attached increasing importance to the development of the cultural and creative industries (CCI). In addition, according to the data of the Census and Statistics Department, the value added of CCI accounted for 4.5 per cent of the Gross Domestic Product (GDP) from 2020 to 2022, indicating that CCI continues to have certain economic value despite the impact of the epidemic. In this connection, will the Government inform this Council:
 
(1) of the policy measures in place to promote the development of CCI in the future, and whether it has estimated the contribution of the industries to GDP and their potential economic contribution in the next five years; if so, of the details; if not, the reasons for that;
 
(2) as there are views that performing arts are an important component of CCI, whether the authorities will provide local performers with more room for development, including making more performance venues available, increasing art workers' access to government subsidies and relaxing their fundraising channels, so as to promote the popularisation of arts and culture in Hong Kong;
 
(3) given that the soon-to-be-opened Kai Tak Sports Park will host various international events to attract a large number of tourists, whether the Government has plans to leverage this advantage to promote local arts tourism; if so, of the details; if not, the reasons for that; and
 
(4) whether it will consider constructing an arts park or large-scale arts and cultural facilities in the Northern Metropolis; if so, of the details; if not, the reasons for that?

Reply:
 
President,

     The arts, cultural and creative industries (CCI) are the important parts for creating a diversified economy in Hong Kong. In 2022, the added value of CCI exceeded $120 billion, accounting for 4.5 per cent of the Gross Domestic Product. The Culture, Sports and Tourism Bureau (CSTB) actively supports the development of CCI, promoting collaboration and organic integration between Chinese and other cultures, and realising the strategic positioning of supporting Hong Kong as an East-meets-West centre for international cultural exchange with the support in the National 14th Five-Year Plan with a view to contributing to the strengthening of international communication capacity of the country.
      
     My reply to the various parts of the question raised by the Hon Jeffrey Lam's question is as follows:
 
(1) The current-term Government is fully committed to promoting the development of CCI as industries. We have completed the restructuring of the Create Hong Kong as the Cultural and Creative Industries Development Agency (CCIDA) in June 2024 as proposed by the Chief Executive in the 2023 Policy Address. The CCIDA is playing a more proactive and positive role to strengthen its support for the development of the CCI under the industry-oriented principle.
 
     The CCIDA works vigorously to foster the creation of an ecosystem that is conducive to the development of CCI, developing CCI as a new driving force for Hong Kong's economy, and branding Hong Kong as Asia's creative capital. For example, the Hong Kong Fashion Design Week will be organised annually starting from 2024 as proposed by the Chief Executive in the 2023 Policy Address, with Hong Kong Fashion Fest as its brand. The core programmes of the inaugural Hong Kong Fashion Fest will take place at different locations in Hong Kong from November 20 to December 4, 2024, consolidating various fashion events to promote the development of Hong Kong's fashion and textile design brands and to reaffirm Hong Kong's position as a prime destination for hosting major cultural and creative events, thereby further promoting the development of the fashion design industry in Hong Kong. As a brand-new flagship event, the Hong Kong Fashion Fest aims to attract prestigious fashion brands and industry players from Hong Kong, the Mainland and abroad. We will develop the Hong Kong Fashion Fest into an annual signature event series, with a view to elevating the international profile of local fashion design. In addition, the CCIDA will continue to sponsor the Hong Kong Design Centre to organise the Design of Business Week 2024 (BODW 2024) from December 2 to 7 this year in collaboration with France as the partner country. Under the theme "Inter/Section: Design, Artistry and Innovation", the BODW Summit will gather over 50 leaders, policymakers and entrepreneurs from all over the world to explore and exchange design knowledge and innovative thinking, and present more than 40 forums and keynote speeches. The event is expected to attract over 900 000 participants/viewership in the exchange. The CCIDA will also sponsor the organisation of a large-scale Hong Kong original art toy exhibition in Jakarta, Indonesia from November 15 to 24, 2024, and 12 exhibiting Hong Kong designers to conduct extended activities and explore local market. Apart from showcasing the Hong Kong original art toys of different generations, the exhibition will also feature cross-sectoral collaboration with Hong Kong comic artists, thereby enabling Hong Kong original art toy designers and comic artists to explore overseas markets.
      
     With the efforts of the CCIDA, we hope that the industries will make use of their innovative spirit and introduce various kinds of new products and services so as to contribute to Hong Kong's economic growth and job opportunities in the coming years by driving the development of other related sectors such as tourism and retail, enhancing cultural confidence and improving the sense of fulfilment of citizens. Furthermore, it plays a crucial role for solidifying Hong Kong's position as an East-meets-West centre for international cultural exchange and telling good stories of China and Hong Kong.
 
(2) The Government is committed to constructing world-class cultural facilities and multicultural spaces, providing more opportunities for the arts sector to organise more local and international cultural and arts activities, and allowing more arts groups and artists to showcase their creative works.
 
     For performance venues, the Leisure and Cultural Services Department continues to improve and expand existing facilities, including the ongoing construction of Yau Ma Tei Theatre Phase 2 as well as the facility improvement works of Sai Wan Ho Civic Centre and Tai Po Civic Centre. Moreover, the Government commenced construction of the New Territories East Cultural Centre (NTECC) in Fanling in July 2023. Upon completion, the NTECC will provide performing facilities of various scales, including two first-of-their-kind facilities in Hong Kong: a children's theatre and two incubator rooms equipped with professional stage facilities for artists to conduct experimental creative works and nurture new productions.
      
     The East Kowloon Cultural Centre (EKCC) has opened its spaces in phases and is undergoing internal facility installation and optimisation. It has launched the "Unbox EKCC" Trial Programmes Series at various venue facilities in preparation for full opening. The EKCC will be equipped with latest innovative stage equipment and systems, and will set up an arts technology incubator to provide a testing platform for artists and technology professionals.

     The West Kowloon Cultural District (WKCD) is one of the most important cultural infrastructure projects of the Government, providing performing arts venue and open spaces for different arts and cultural activities. The Grand Theatre and Tea House Theatre of Xiqu Centre, black box theatre and various multi-purpose venue in Freespace, and Art Park, in which large-scale performances can be held, bring together renowned and rising artists and arts groups from Hong Kong, Mainland China and overseas and present performing arts programmes spanning multiple genres including xiqu, music, theatre and dance. Lyric Theatre Complex, which is currently under construction, would provide theatres of different capacities and a number of rehearsal studios upon completion, becoming a centre of excellence showcasing the best of Hong Kong and international dance and theatre.
      
     The Government has been providing suitable support to the arts and culture sectors through different funding models and schemes, such as regular subvention to the major performing arts groups, and funding support through the Arts Capacity Development Funding Scheme (ACDFS) for cross-year arts and cultural projects/activities that are of certain scale, with a view to enhancing capacity development of promising arts groups and artists. The Hong Kong Arts Development Council is also committed to the implementation of various regular and project-based funding schemes to support small and medium sized arts groups, including the Emerging Artists Development Grant to support and nurture promising and budding arts groups and artists. Meanwhile, we also encourage arts groups and artists not to solely rely on government funding support but aim to attract paid audience and seek other funding recourses and subsidies to develop arts and culture as industry.
      
     The Government has announced the launch of the Signature Performing Arts Programme Scheme (SPAPS) for nurturing representative and large-scale local performing arts productions for long-running performances. Each selected programme under the SPAPS will receive direct subsidy, and a matching subsidy to match with the private sponsorship raised and box income received, with a view to bringing in resources from the community to jointly contribute to the development of local performing arts, and encouraging the selected programmes to seek wider funding sources and audience support. Application details will be announced later and the SPAPS will open for applications in December.
      
     The Government also actively encourages arts groups and organisations to expand their funding sources. The Art Development Matching Grant Scheme and the Springboard Grant of ACDFS under CSTB provides matching grant for donations and sponsorships raised by eligible arts groups/organisations, enhancing their fund raising ability as well as fostering all walks of the community to jointly take part in the development of arts and culture.
 
(3) Opening in the first quarter of 2025, the Kai Tak Sports Park (KTSP) is the largest sports infrastructure project ever commissioned in Hong Kong. The KTSP will provide modern and multi-purpose facilities. Among other things, the 50 000-seat Kai Tak Stadium, being equipped with a retractable roof, offering different stage positioning and seating configurations as well as adopting a flexible pitch system design, provides more options for hosting different types of large-scale cultural and entertainment events such as sports competitions, art and cultural performances and concerts. The 10 000-seat indoor sports centre (named Kai Tak Arena) is also equipped with retractable seating system and flexible configuration of the play field, allowing the hosting of various kinds of sports, culture or entertainment events.
 
     The KTSP will provide the venues required for the development of large-scale sports events as well as cultural and arts performance, thereby creating the conditions for further promoting mega event economy. Over the past few years, the operator has proactively reached out to stakeholders from sectors including sports, arts and culture, and has showcased the advantages of KTSP's multi-purposes facilities to over 200 local and international organisations through various channels. The CSTB will continue to work closely with the operator and various government departments to ensure the successful completion and commissioning of the KTSP and unleash the opportunities brought by this world-class hardware, with a view to boosting sports development and injecting impetus into related industries such as recreation, entertainment and tourism (including tourism in arts and culture).
 
(4) With new land, new communities and the advantage of close connections with the Mainland, the Northern Metropolis will provide new opportunities for the development of cultural facilities. The Government plans to construct a Cultural Complex in San Tin Technopole, including a major performance venue, a major museum, and a major library. In addition, the Government also plans to build dedicated performance venues in New Territories North New Town and Lau Fau Shan. These planned cultural facilities, together with the NTECC currently under construction in Fanling, will bring more brilliant local and international performing arts programmes to the citizens. This will help consolidate Hong Kong's position as the East-meets-West centre for international cultural exchange.