Innovation and technology is one of the six new economic drivers recently identified by the Chief Executive's task force on economic challenges as offering potential for development in Hong Kong.

We are seeking views from various stakeholders as we formulate a robust development strategy for the sector. Looking ahead, we will step up our funding programmes and continue to expand our infrastructural support.

One key initiative will be a focus on collaboration with the Mainland where many Hong Kong-based manufacturing operations are located and where there is a strong potential domestic demand for the products that are starting to emerge from research in the field.

In terms of funding, the Innovation & Technology Fund has already supported over 1,300 projects in different technology areas with a total funding of nearly $4 billion. Of these, over 100 projects with a total funding of $409 million are specifically dedicated to nanotechnology and advanced materials.

We do have many success stories where research in the nanotechnology field has been developed and now is put into commercial use. My personal favourite is the use of nano-catalyst for air purification. My permanent secretary was so impressed when he visited the company that he bought one for his office.

To sustain the momentum in fostering innovation, earlier this year we expanded our Internship Programme to cover private sector companies under our funding programme for small and medium sized enterprises.

For those of you seeking to obtain R&D funding under this programme, please take advantage of the internship scheme. I am sure this will help you to speed up your project by having additional manpower, in addition to, of course, providing training and employment opportunities to our graduates.

For infrastructural support, the Hong Kong Science Park provides state-of-the-art infrastructure and quality support for companies in the innovation and technology field. To meet future demand, we are exploring the feasibility of developing a third phase of the park.

There are many success stories in the science park but unfortunately, not many of them are given the publicity that they deserve. So let me just take a little bit of time to take you through one or two notable examples.

AppoTech Limited, which specialises in the design and development of high performance yet affordable integrated circuits, was an incubatee in the science park in 2003. The company has grown from a team of four people to over 100 employees, enjoying a growth rate of 500%.

Another company by the name of Kopin, which produces leading-edge lightweight, power-efficient, ultra-small liquid crystal displays, is now the supplier to some of the world's largest consumer electronics manufacturers including JVC, Konica Minolta, Kodak and Samsung.

These and many other examples clearly illustrate the benefits to the economy that could be brought about through the provision of world class support services and facilities as well as the clustering effect for technology companies, big or small.

The five R&D centres which we established in April 2006 are progressing steadily to roll out their R&D programmes and we have recently reported to the Legislative Council on the excellent work that they have achieved during the past two years.

Many of their projects will be completed by the end of this year or early next year, and we hope to be able to transfer the results of their technological innovations to industry.

Of these, the Nano & Advanced Materials Institute, NAMI for short, should not be a stranger to you. It is the R&D Centre dedicated to the development of our core competencies in nanotechnology and advanced materials.

In the past two years, the centre has conducted a number of projects that are worth mentioning. The humidity nano sensor developed by NAMI is a good example of success. This is a relatively small project but well sought after by our electronics manufacturers because the quality and standard are equal to those developed by advanced economies but at much lower cost.

Another good example is the LCD technology that NAMI is still working on, and this, if successful, I am given to understand, will enable our Mainland and local manufacturers to advance the country's roadmap through indigenous innovation without relying on imported technology.

Over the next few years, NAMI will become a major R&D Centre focusing on the development of solar energy. It is already embarking on a very ambitious expansion programme to develop its core competencies in thin film photovoltaic technology to cope with future challenges.

Many of you will be aware of the collaboration with DuPont in conjunction with the Shenzhen Municipal Government under the aegis of the Shenzhen Hong Kong Innovation Circle.

This important project is the first of what I hope will be many more that can be taken forward through co-operation and collaboration with multinational firms wishing to establish their R&D bases in Hong Kong, while leveraging on the vast production capability of our Shenzhen partner across the border.

Secretary for Commerce & Economic Development Rita Lau gave this address at the 2009 International Conference on Nanotechnology & Advanced Materials.