Hong Kong should draw on the experiences of Singapore and the United Kingdom to accelerate AI adoption, according to research published by the Legislative Council Secretariat.
Although Hong Kong has identified AI as a priority industry, it has yet to adopt a standalone economy-wide AI strategy. A 2025 survey found that only around 2% of local organisations were fully prepared for AI, compared with a global average of 13%.
Hong Kong ranked 20th in the International Monetary Fund’s AI Preparedness Index, behind Singapore, Japan, South Korea and the UK. While it scored highly for digital infrastructure and innovation, it ranked considerably lower in human capital, labour policy, regulation and ethics.
The report identifies fragmented governance, limited in-house expertise and insufficient computing capacity as major barriers. Around 44% of Hong Kong businesses reportedly struggled to secure adequate processing power, while many, particularly smaller firms, lacked support for redesigning workflows and integrating legacy data systems.
Singapore has addressed these barriers through coordinated funding, diagnostics and technical assistance. Grants subsidise approved AI tools, while government programmes connect businesses with consultants, engineers and major cloud providers. By October 2025, its Enterprise Compute Initiative had linked around 1,000 companies with cloud partners.
However, the report notes that Singapore also faces challenges in moving from experimentation to widespread organisational transformation. AI adoption reached 62.5% among larger companies and 14.5% among SMEs in 2024, yet only 4% of firms had integrated AI into their core business processes by 2026.
The UK has concentrated support on SMEs and traditionally less digitised sectors through programmes such as BridgeAI and Made Smarter, which combine funding with mentoring, diagnostics, training and technical collaboration. Business use of AI increased from 9.4% in September 2023 to 25.9% in March 2026, with particularly strong growth in construction, transport and manufacturing.
Both Singapore and the UK have also expanded computing infrastructure. Singapore combines cloud credits with technical support, while the UK is investing in public supercomputers and regional AI Growth Zones, which had attracted £28.2 billion in planned investment by January 2026.
The report concludes that accelerating AI adoption will require more than financial incentives. A coordinated approach combining affordable computing, technical support, workforce development and assistance with business transformation could help organisations move from isolated AI pilots to widespread operational use.
Why does it matter?
The report highlights that digital infrastructure alone is not enough to drive AI adoption. Countries that combine funding with technical assistance, workforce development, computing capacity and coordinated governance appear better positioned to translate AI investment into measurable productivity gains.
For Hong Kong, the findings suggest that competitiveness will depend less on access to AI technologies than on the ability of businesses, particularly SMEs, to integrate them into everyday operations. The report therefore reinforces a broader international trend towards AI adoption policies that emphasise implementation alongside innovation.
Would you like to learn more about AI, tech, and digital diplomacy? If so, ask our Diplo chatbot!
