In a push to position itself as a leading hub for technological innovation, Hong Kong has officially launched the Artificial Intelligence Research and Development Institute. South China Morning Post reports that the new institute is backed by a substantial HK$1 billion (US$127.6 million) investment from the government, and is tasked with formulating the city’s comprehensive AI roadmap and driving an ambitious “AI for all” strategy designed to benefit all sectors of society. This significant investment underscores Hong Kong’s commitment to leveraging AI to enhance its economic competitiveness and improve the quality of life for its citizens.
The establishment of the institute, first announced by Financial Secretary Paul Chan Mo-po in his February budget, underscores the Hong Kong government’s recognition of AI as a critical driver of future economic growth and societal advancement. The institute aims to bridge the gap between academic research and practical application, facilitating the entire research and development (R&D) chain from upstream innovation to midstream and downstream industrial transformation. By fostering collaboration between academia, industry, and government, the institute seeks to create a vibrant AI ecosystem that can translate cutting-edge research into tangible economic and social benefits.
Integrating and Advancing Local LLMs
To lead this critical initiative, the government has appointed a heavyweight 14-member board of directors. The board is chaired by Professor Harry Shum Heung-yeung, a renowned computer scientist and adjunct professor at the Hong Kong University of Science and Technology (HKUST), who brings nearly 24 years of experience as a top executive at Microsoft. He is joined by deputy chairman Hendrick Sin, a prominent tech entrepreneur and co-founder of CMGE Technology Group. The inclusion of such high-profile figures signals the government’s intent to leverage top-tier expertise to guide the city’s AI development. The board’s diverse expertise will be crucial in navigating the complex technical, ethical, and economic challenges associated with AI adoption.
One of the immediate priorities for the new institute, which is expected to hold its first meeting in April or May 2026, is the integration and advancement of locally developed large language models (LLMs). A key focus will be on HKChat, the city’s first homegrown LLM, developed by the Hong Kong Generative AI Research and Development Centre (HKGAI) under the government’s InnoHK initiative. The institute will play a central role in coordinating the further development and deployment of HKChat across various sectors.
HKChat has already seen significant adoption, boasting over 600,000 registered users and being actively utilized by 40,000 civil servants across various government departments. The institute will explore ways to further enhance HKChat’s performance, particularly in handling the nuances of the Cantonese language, which presents unique challenges compared to developing models for English or Mandarin. Improving HKChat’s Cantonese capabilities is essential for ensuring that the model is truly accessible and useful to the local population.
Government Applications and the AI+ Strategy
Furthermore, the institute will tackle the complex issue of deploying AI securely within government operations. A major hurdle is enabling AI models to process restricted or classified information without compromising security. Permanent Secretary for Innovation, Technology and Industry Kevin Choi Kit-ming highlighted this challenge, noting the inherent tension between the restrictive nature of classified data and the openness required for AI models to learn and perform effectively. Finding a balanced solution will be a critical task for the institute and the Digital Policy Office. Developing robust security protocols and privacy-preserving AI techniques will be essential for building public trust and enabling the widespread adoption of AI in sensitive domains.
Beyond government applications, the institute’s mandate extends to the broader “AI+” strategy, which aims to popularize the technology and enhance digital literacy across Hong Kong. The government has allocated an additional HK$50 million to bolster public awareness and skills. This initiative involves cross-sector collaboration with key institutions like the Science Park, Cyberport, and the Hong Kong Productivity Council. These organizations will work together to develop training programs, workshops, and public awareness campaigns designed to demystify AI and equip citizens with the skills needed to thrive in an AI-driven economy.
These organizations will play distinct roles in the “AI for all” rollout. The Productivity Council will focus on promoting AI adoption among small and medium-sized enterprises (SMEs), helping them leverage the technology to improve efficiency and competitiveness. Meanwhile, Science Park and Cyberport will target the professional innovation and technology sector, as well as the general public and students, fostering a citywide culture of AI understanding and engagement. This multi-pronged approach ensures that the benefits of AI are accessible to all segments of society, from large corporations to individual citizens.
The launch of the Artificial Intelligence Research and Development Institute marks a significant milestone in Hong Kong’s technological evolution. With substantial funding, expert leadership, and a clear mandate to drive both R&D and public adoption, the institute is well-positioned to shape the city’s AI future. By focusing on homegrown solutions like HKChat and addressing the practical challenges of secure deployment, Hong Kong is taking decisive steps to ensure that the benefits of the AI revolution are realized across its government, economy, and society.