Huge business opportunity for HK in smart city services

June 17, 2019 11:29
Hong Kong is well placed to offer its expertise and technology to developing countries in the region for smart city projects, an observer says. Photo: Bloomberg

According to Frost & Sullivan, smart city global market potential on initiatives pertaining to sectors  such as transportation, healthcare, construction, energy, infrastructure and governance, can reach as much as US$1.5 trillion in total, close to the GDP of South Korea, Russia or Australia. 

In March, at a smart city workshop organized by the Asian Productivity Organization (APO) which invited me as a mentor, I noticed that many countries, including Thailand, Vietnam, Indonesia, India and the Philippines, have been working hard to explore ways to solve their current problems through application of smart technology.

For example, the situation in Ho Chi Minh City, Vietnam is quite typical. Authorities want to develop Ho Chi Minh City into a smart city by 2025, so as to help solve the city’s major problems. The key issues facing planners are:

1. Rapid population growth: Being Vietnam’s center of economy, finance, trade and technology, Ho Chi Minh City is home to more than 8 million people, or 9 percent of the country's population. Since 2011, a large number of migrants have poured in, and the population has been growing by an average of over 2 percent a year, leading to problems in medical care, housing, public order and transportation, as well those pertaining to pollution. Not surprisingly, the city's infrastructure lagged the population growth.

Hong Kong, too, had experienced the same problems in the past as a result of influx of immigrants from mainland China during the 1950s and 1960s, but the city managed to overcome the challenge and has become an international financial center and a Asian economic tiger. Hong Kong's success story should offer some inspiration to Ho Chi Minh City.

2. Declining competitiveness: Although Ho Chi Minh City's industry has been growing rapidly with contribution to the national GDP at 18-21 percent, its export ratio compared to other provinces in Vietnam is declining. The ranking at the Provincial Competitiveness Index (PCI) has confirmed the worry - this is the same problem as Hong Kong is facing today, forcing us to invest heavily in innovation and technology to reverse the trend. We open data actively and seek to strengthen cooperation with neighboring cities such as those in the Greater Bay Area to promote innovation and economic development.

3. Increasing public expectations of the government: Ho Chi Minh's annual income per capita continues to increase, reaching US$5,538 in 2015, an increase of more than 70 percent compared to 2010. The strong income growth has led to increased demands and expectations from the public on matters such as health, education, transportation, environment, and public services. This naturally brings a lot of pressure on the government.

However, due to lack of comprehensive use of information technology in urban management, the government’s planning and forecast of the city’s needs were less effective – it is common for people in developing places to have high expectations exceeding the capability of the government. The best way to tackle the issue is to increase transparency in governance.

By opening up data and providing constant updates on matters related to people's livelihood, such as transportation, housing, employment, etc -- like the Mayor's Dashboard in Los Angeles, US, and Hong Kong’s City Dashboard to be launched at the end of this year -- the public can monitor the progress on issues of their concern, thus, improving the relationship between the government and the public.

Hong Kong is in a very strong position to assist ASEAN countries to develop as smart city. Outside Europe and the US, Singapore and South Korea are also very ambitious in exporting their smart city experience. For example, Singapore led the establishment of the ASEAN Smart Cities Network (ASCN) last year, attracting 26 cities in the region, including those from Myanmar, Laos and Vietnam, as pilot cities.

South Korea is also committed to promoting the same to the Middle East, South Asia and South America. The country claims to be involved in 100 smart city projects with India. Elsewhere, Taiwan’s international influence is not as substantial as others, but by sharing the experience of some cities, such as Taipei and Kaohsiung, they believe they also have big potential to export smart city works.

In Hong Kong, the government had introduced advanced information technology 20 years ago. We had begun to adopt geographic information system (GIS) for analysis and decision-making many years earlier than many cities in the Asia-Pacific region. Last year, the Lands Department took the lead in linking data sets of various government departments.

Spatial data infrastructure is already in shape; smart city projects such as smart lampposts are also ready to be launched; plus there are financial initiatives for works such as opening up more data through application programming interface (API), virtual bank licenses, etc.

All these initiatives show that Hong Kong has established credentials to assist ASEAN countries and neighboring cities in smart city development. If Hong Kong government can speed up and improve its spatial data infrastructure quickly, it will certainly help boost the export of local expertise and technology.

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Adjunct Professor, Department of Computer Science, Faculty of Engineering; Department of Geography, Faculty of Social Sciences; and Faculty of Architecture, The University of Hong Kong