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While we are all aware of terms such as low fat, low sugar and low calories, the phrase "low carbon" is also creeping its way into today's lexicon, and for a significant reason. Associated with the reduction of greenhouse gases that are attributed to global climate change, realizing a low-carbon economy is both essential for the well-being of the planet and for remaining competitive, as cities and nations around the world vie to become leaders of a new green order.

The importance of a low-carbon economy has been recognized by the central government in Beijing. Faced with severe environmental challenges resulting from rapid modernization, the country's leaders have come to realize that developing a low-carbon economy will not only help address environmental concerns, but also create competitive advantages that will allow China to lead what some have called the next industrial revolution. According to a report issued earlier this year by the Australian environmental group Climate Institute, China is already among the most prepared countries for a low-carbon economy - placing third behind France and Japan in the Low-Carbon Competitiveness Index, which is part of the Institute's Global Climate Leadership Review 2013. China's significant high-tech exports such as low-cost solar cells, and its substantial investment in green technologies at just under half of the global public equity investment in clean energy were among the developments that elevated the country four places from last year's ranking, which regards sectoral composition, early preparedness and future development as three major measures of carbon competitiveness.

A low-carbon economy is undoubtedly also important for the development of Hong Kong. The city continues to struggle with various environmental issues and would greatly benefit from an environmental market that, according to the Hong Kong Trade Development Council, could reach $11.6 billion by 2018 - and this is within the SAR alone. Correspondingly, the government has implemented a number of initiatives over the past several years to nurture the environment industry.

To encourage building owners to raise the energy efficiency of their properties, a $58 million Building Energy Efficiency Funding Scheme was established. In addition, a tax deduction was introduced to persuade local companies to operate environmentally friendly facilities by upgrading outdated technologies. In respect of green transportation, the waiving of a first registration tax on electric vehicle purchases is in place, and a HK$300 million Pilot Green Transport Fund aims to remove polluting vehicles from Hong Kong's roads by incentivizing owners to acquire more emission compliant models.

On a larger scale, the local administration established the Cleaner Production Partnership Programme which, since 2008, has been helping Hong Kong-owned factories in the Pearl River Delta - numbering more than 50,000 - to improve energy efficiency, reduce air pollution and treat waste water. However, since these companies require approximately $5 billion in environmental technology goods and services each year and this figure is expected to double before the turn of the decade, reassessing the amount of such financial support is greatly needed.

While it is important to tackle current environmental challenges through the aforesaid steps, for Hong Kong to realize a low-carbon economy requires more than reactive measures. Nurturing innovation and technology development remains imperative, and is the raison d'etre of the Hong Kong Science and Technology Parks Corporation. The statutory body has been championing the advancement of green technologies through various efforts, one of which is bridging ties with relevant public and private organizations.

Its most recent accomplishment is the signing of a memorandum of understanding (MOU) with Scottish Development International - Scotland's international trade and investment body - which provides a framework for knowledge transfer and cooperation in the low-carbon sector. Scotland has demonstrated excellence in decarbonizing the energy consumed by the electricity, heat and transport sectors; delivering a zero waste to landfill policy; and employing sustainable construction and retrofit methods. The MOU will welcome suitably qualified Scottish companies to Hong Kong Science Park, allowing local companies to learn and adapt low-carbon solutions to meet regional requirements.

Certainly, the knowledge that Hong Kong can clean up its environment, develop an industry with enormous potential and also stand up for the common good should provide the necessary determination and commitment.

The author is chairman of the Hong Kong Science and Technology Parks Corporation.

(HK Edition 08/30/2013 page9)