Responses from University Grants Committee on 2026-27 Budget
The following is issued on behalf of the University Grants Committee:
The 2026-27 Budget outlines financial measures related to higher education, including earmarking $10 billion for providing loans to University Grants Committee (UGC)-funded universities and universities of applied sciences for campus development in the Northern Metropolis University Town, as well as supporting on a matching basis, the Hong Kong University of Science and Technology in developing the third medical school.
The chairman of the UGC, Mr Tim Lui, said yesterday (February 25), "The UGC supported relevant measures. The Northern Metropolis University Town and the third medical school would not only provide development room for the whole post-secondary education sector to expand capacity and enhance quality, but would also serve as a key engine to advance the deeply integrated development of Hong Kong's academic excellence and industry. The UGC Secretariat will continue to support relevant work."
At the same time, with the advent of artificial intelligence, innovative and breakthrough technology in the new era, the UGC-funded universities are utilising resources effectively during the 2025-28 triennium, and introduced 27 undergraduate programmes relevant to STEAM (science, technology, engineering, arts and mathematics). The new programmes would foster innovation and technology (I&T), nurture more high calibre talent to support Hong Kong's development into an international I&T hub, and inject impetus into future development.
He added, "The UGC also appreciates the Hong Kong Special Administrative Region Government's strong support to promote internationalisation of higher education, including the establishment of the Task Force on Study in Hong Kong and the organisation of 'Study in Hong Kong' Week. The Asia-Pacific Association for International Education 2026 Conference and Exhibition, currently underway, has received a very encouraging and overwhelming audience, attracting over 3 200 global education experts from more than 70 countries and regions. As a hub for attracting global talent and facilitating academic exchange, Hong Kong's international reputation and appeal would be further enhanced. The UGC will continue to work closely with each university to deepen international partnership, and will further enrich Hong Kong's diverse and vibrant higher education environment."
Source: AI-found images
Remarks by FS at Budget press conference (with photos/video)
The Financial Secretary, Mr Paul Chan; the Secretary for Financial Services and the Treasury, Mr Christopher Hui; the Permanent Secretary for Financial Services and the Treasury (Treasury), Mr Andrew Lai; and the Government Economist, Ms Irina Fan, held a press conference on the Budget at Central Government Offices, Tamar, today (February 25). Following are the remarks by Mr Chan:
Reporter: Good afternoon, Mr Chan, some English questions. Firstly, the Government has ruled out using the Exchange Fund in 2021, warning of severe consequences at the time. Could you explain why the Government thinks it's okay to use the Exchange Fund now? And also, what are the potential risks you see in making this move, and could you also explain the Government's motivation in streamlining the Government's various funds in this Budget? Secondly, on tax policy, the Government said they will set up a committee chaired by you to review Hong Kong's tax policy. What is the Government's direction in this committee? And are you planning to increase the tax base? And if so, could you give some specifics on how you're going to go about it? Thank you.
Financial Secretary: Thank you. The main purpose of the Exchange Fund is to defend Hong Kong's financial stability and our financial system. Last year, the Exchange Fund made an investment income of over $300 billion. Now we are transferring from the Exchange Fund about half of it, $150 billion, in two instalments commencing from 2026-27. Having regard to the current size of the Exchange Fund, which is over $4,100 billion, and considering that we are just taking half of their income earned last year back to the Government, while also for investment purposes, we think this is a considered and prudent move. We are very confident that, given our various measures in place and the strong buffer of the Exchange Fund, we would be able to weather volatility or even attacks on our financial system.
In terms of tax policy, what I have proposed is to set up a group of advisors comprising mainly people from the business and professional sectors. The purpose of this advisory committee is to look at the tax competitiveness of Hong Kong. Over the years, various jurisdictions rolled out different incentives and tax measures, seeking to compete for investments and businesses. Globally, under the OECD (Organisation for Economic Co-operation and Development), there are also certain global requirements on minimum tax known as BEPS (Base Erosion and Profit Shifting) 2.0. Taking this into consideration, we think we should set up an advisory committee with a focus on how to use tax policy as a competitive tool, so as to attract businesses and investment to grow our economy. It is not going to touch our current tax system to widen the tax base. Therefore, things like GST (goods and services tax) and VAT (value-added tax) would not be included in the ambit of this committee.
Reporter: The Budget earmarks $220 million to establish the first national manufacturing innovation centre outside the Chinese Mainland. So could you please clarify the centre's positioning, proposed location, operational model and the expected timeline for implementation? Which advanced manufacturing sectors or new quality productive forces, will it prioritise? And given that this will be the first such centre outside the Chinese Mainland, what is different from existing national manufacturing innovation centres within the Mainland? Will it focus, in particular, on strengthening international co-operation? Thank you.
Financial Secretary: The National 15th Five-Year Plan is still at a recommendation stage, but high-quality development is the underlying tone. For high-quality development, there are two major underlying guiding principles. One is green development. The other is technological innovation and technology self-reliance.
Hong Kong plays a unique role in this respect. Thanks to the "one country, two systems" arrangement, we are in the best position to attract top talent from all over the world so that they could use Hong Kong as a base to do research, to collaborate and to look for application scenarios. That is why we set up this centre. The positioning is to look at frontier technology, particularly AI, healthtech, and attract both international as well as Mainland top scientists, engineers and researchers to come to Hong Kong. Thank you.
(Please also refer to the Chinese portion of the remarks.)
Source: AI-found images
Remarks by FS at Budget press conference (with photos/video) Source: HKSAR Government Press Releases
Remarks by FS at Budget press conference (with photos/video) Source: HKSAR Government Press Releases
Remarks by FS at Budget press conference (with photos/video) Source: HKSAR Government Press Releases
Remarks by FS at Budget press conference (with photos/video) Source: HKSAR Government Press Releases
Remarks by FS at Budget press conference (with photos/video) Source: HKSAR Government Press Releases
Source: AI-found images
