On February 26, the Financial Secretary of the HKSAR Government, Mr. Paul Chan, delivered the Budget for the fiscal year 2025 to 2026 (hereinafter referred to as the “Budget”), proposing a “strengthened” fiscal consolidation strategy. In the area of Environmental, Social and Governance (ESG), the Budget emphasizes on technology and innovation, and introduces a number of key initiatives to accelerate green development, strengthen the new momentum of the economy, and accelerate the enhancement of the competitiveness of traditional industries, demonstrating the Government's strong commitment to green development.

Active Layout of Green Finance and Technology

Mr. Chan pointed out that the development of green industries is a major international trend and a key to addressing global climate change. The combination of green finance and green technology will accelerate the building of rich industry clusters, bring about huge business opportunities and financing needs, and contribute to green transformation and development.

In the area of green finance, the Budget pointed out that the Sustainable Finance Action Plan was announced last year, specifying the banking sector's goal of moving towards net-zero emissions. At the same time, the Hong Kong Sustainability Disclosure Roadmap has been launched, mapping out a clear pathway for the full adoption of the International Standard on Sustainability Disclosure for Financial Reporting (ISSB Code) by large publicly-accountable entities by 2028, making Hong Kong one of the first places to adopt the ISSB Code. This will enable Hong Kong to be one of the first jurisdictions to converge with the ISSB Code. To nurture local green financial talents, the Pilot Green and Sustainable Finance Training Scheme has been extended to 2028, with a total of over 5,700 applications approved so far.

On green technology, HKSTPC has developed the Kowloon Tong Innovation Center into a “GreenTech Hub”, which is expected to bring together over 200 green technology enterprises. It is expected to bring together over 200 green technology companies, and will join hands with financial, commercial and university organizations to provide a full range of support, such as talent training, testing scenarios and business matching for the resident companies.

There are also new developments in green shipping and green aviation. The Government provides tax exemption for green methanol used for refueling, implements the Action Plan on Green Bunker Filling, and makes every effort to promote Hong Kong as a green bunker fuel refueling center. On green aviation, in order to help the international and local aviation sectors reduce carbon emissions, the Hong Kong International Airport is actively promoting the application of sustainable aviation fuel (SAF). The AA has completed the relevant study and will announce the SAF usage target within this year.

Increase 180 million yuan to lay out intelligent food waste recycling

On waste reduction and recycling, the Government will allocate an additional 180 million yuan to provide additional smart food waste recycling bins or collection facilities for all residential premises in Hong Kong, so as to further expand the recycling network and increase the amount of recyclables collected, thereby reducing waste generation at source. Waste-to-energy conversion work is also progressing steadily. The first municipal solid waste-to-energy facility, “I-PARK1”, is expected to come into operation within this year, and the second large-scale facility, “I-PARK2”, for which tenders have been invited, will be able to treat 6,000 metric tons of waste daily upon completion. Upon completion, the facility will be able to treat 6,000 metric tons of waste per day, helping to achieve “zero waste to landfill”.

Currently, Hong Kong has more than 100,000 electric vehicles, eight times the number five years ago. To vigorously develop green transportation, the Government plans to launch a 300 million yuan funding scheme in the middle of the year. It is expected that by 2030, the Government will encourage the industry to install a total of 3,000 high-speed charging piles to meet the charging demand of an additional 160,000 electric vehicles. At the same time, the Government announced the “Roadmap for Green Transformation of Public Buses and Taxis”, setting aside 470 million yuan in the New Energy Transport Fund to subsidize franchised bus operators to purchase about 600 electric buses, and 135 million yuan to subsidize the cab trade to purchase 3,000 electric cabs. The Hydrogen Fuel Cell Heavy Duty Vehicle Funding Pilot Scheme has also been opened for application. In addition, the construction of a smart and green collective transport system has continued to progress. Expressions of interest were invited for Kai Tak and East Kowloon last year, and tenders will be invited for the Kai Tak project this year, and for the projects in East Kowloon and Hung Shui Kiu/Ha Tsuen and the Yuen Long South New Development Area next year.

There are also new moves in the sustainable development of agriculture and fisheries. The Government will continue to promote the Blueprint for Sustainable Development of Agriculture and Fisheries. In agriculture, land has been reserved in Sheung Shui for the construction of multi-storey modern and environmentally-friendly livestock farms; in fisheries, licenses for mariculture in Wong Chuk Kok and Tai Peng Bay will be issued in the middle of this year at the earliest, and the establishment and certification of brands for recreational fisheries and local fisheries and agricultural products will also be promoted.

Author: Circle