While the budget speech delivered by Financial Secretary John Tsang on Wednesday doesn't include support to Hong Kong's tech firms, the government will provide up to HK$12 million to help local universities commercialize R&D results.

According to Tsang, only six local universities with tech transfer offices already established will benefit from the new funds for three years starting from 2013-14 through the Innovation Technology Fund.

"If we can transform technology research outcomes into products with market potential, coupled with industrial production, our technological development can make an even greater contribution to Hong Kong's economy," Tsang said.

Given the increasing use of online banking and payment, the government will also consider changes to the legislation so that it can introduce a licensing regime for stored-value electronic money and to empower the Hong Kong Monetary Authority to supervise retail payment systems, Tsang noted.

"The development of electronic payment instruments and retail payment systems can make payment processing more efficient for companies, especially those in the retail industry," he said. "Such development will encourage local enterprises to extend their global sales networks, and stimulate the growth of other ancillary trades, including electronic transaction services and computer system developments."

Mok: Why more money to R&D by universities?

Legislative Councilor (IT Constituency) Charles Mok slammed the government's university R&D fund. "The IT industry has long called for tax rebates to private firms engaging in R&D," he said. "The only reason the government's not doing that and continues to focus on [funding] R&D by public sector [and universities] is to get rid of possible 'administrative hassles' [brought by supporting private sector R&D]," Mok said.

"This is one of the major reasons why the local private sector find it so hard to commercializeits R&D results," he noted. "Things won't change if the government continues its own way."

According to Mok, while it's important to introduce a licensing regime to stored-value electronic money, there are other areas of concern -- information security, consumer protection, fair and effective competition, adoption of international standards, and connection with regional systems -- that the government should study.

Mok also advised the government to get feedbacks from the IT sector on electronic money and payment, saying he has already been in touch with the Financial Services and Treasury Bureau.