On September 18, 2025, Hong Kong’s Chief Executive John Lee delivered his much-anticipated fourth policy address, setting out an ambitious blueprint for the city’s future. In a speech that spanned nearly three hours and followed months of consultation, Lee made it clear: improving residents’ livelihoods is not just a priority—it’s the “ultimate objective in governance.” But beyond the rhetoric, his address marked a decisive pivot toward deepening reforms, unleashing new economic engines, and leveraging Hong Kong’s unique position at the crossroads of China and the world.
The centerpiece of Lee’s address was the accelerated development of the Northern Metropolis, a vast swath of land bordering Shenzhen that’s set to become Hong Kong’s next economic powerhouse. Covering roughly one-third of the city’s total land area and population intake, the Northern Metropolis is envisioned as a new IT hub and university town, expected to provide 650,000 jobs and house 2.5 million people. The proposal, first floated in 2021 by Lee’s predecessor Carrie Lam, has now taken on fresh urgency as Hong Kong seeks to reassert its international competitiveness amid shifting regional dynamics and economic headwinds.
“The Northern Metropolis, our city’s strategic development area bordering Shenzhen, covers a land area and planned population intake accounting for about one-third of Hong Kong’s total,” Lee stated. He announced the formation of the Committee on Development of the Northern Metropolis, which he will personally lead, with three specialized working groups focusing on development models, university town planning, and end-to-end project management. Dedicated legislation, targeted for introduction in 2026, will aim to streamline statutory procedures—cutting red tape and accelerating approvals for everything from industrial park companies to building plans.
Industry leaders have largely welcomed the government’s renewed focus, but their support comes with caveats. According to South China Morning Post, figures such as Wing Law, Asia CEO at AtkinsRéalis, underscored the critical role of new transport links like the Kwu Tung and Hung Shui Kiu stations and the Northern Link, due between 2027 and 2034. “These will be the backbone of the development, strengthening connectivity and integration with the Greater Bay Area,” he said.
Yet, optimism is tempered by practical concerns. High construction costs, uncertain timelines, and policy ambiguity could stymie investment, warned JLL’s Alkan Au. “Clearer timelines, incentives, and government-backed infrastructure spending are needed to attract developers, alongside faster approvals and better coordination,” Au told Hong Kong Economic Journal. PwC’s Davis Cho echoed this sentiment, supporting fast-track systems but urging the introduction of performance metrics, cross-boundary digital platforms, and financing tools to draw international capital.
Consultancy firm Arup called the Northern Metropolis “a cornerstone of Hong Kong’s future,” praising its focus on innovation and climate resilience. CBRE suggested that new legislation and the development committee could help reduce risk, while tax incentives and more flexible land-grant arrangements might attract strategic enterprises and skilled talent, boosting real estate demand. Colliers, meanwhile, recommended phased development to lower upfront costs and test the market, as well as flexible land tenders tied to industry needs to prevent land from sitting idle.
Land experts and academics have also weighed in, urging the government to bring the private sector into the fold early. Nicholas Brooke, chairman of Professional Property Services, told RTHK, “I think there is the need to involve the private sector at a very early stage, not only to [figure out] what works, but where is the demand and where is the future demand because this is all long term so one has to project forward and think about where demand and what people would want in the longer term.” Brooke also advocated for a dedicated agency to deliver the ambitious project, rather than relying solely on government leadership.
Jason Leung, Head of Land and Housing Research at Our Hong Kong Foundation, expressed hope that private companies could play a major role in attracting enterprises and shaping commercial terms under the committee’s working groups. “Hopefully there can be some sort of job distribution or specialisation that will make the process better,” Leung said. Rita Li, Director of the Sustainable Real Estate Research Centre at Shue Yan University, highlighted the value of tapping into Hong Kong’s academic strength: “We can make good use of what we have in terms of research and development and devise some incentives for these university students, PhD students and research students to start startups, [allowing them] to turn their concepts and research into products.”
Lee’s policy address also laid out a broader agenda for economic and social renewal. The government will invest 1 billion Hong Kong dollars (about 128.62 million U.S. dollars) to establish the Hong Kong AI Research and Development Institute in 2026, aiming to position the city as a leader in artificial intelligence. Plans include the establishment of an AI Efficacy Enhancement Team to coordinate the adoption of AI across government departments, as well as promoting cross-boundary data flow from mainland China for scientific research and innovation.
To further reinforce Hong Kong’s standing as an international financial center, Lee announced the creation of an international gold trading market and the refinement of the Capital Investment Entrant Scheme (CIES) to attract talent and capital. Universities will be permitted to admit self-financing non-local students up to 50% of local student places starting from the 2026/27 school year, up from the current 40%. The over-enrolment ceiling for self-financing funded research postgraduate programs will also rise, encouraging greater internationalization and academic exchange. The Education Bureau will establish a Task Force on Study in Hong Kong to attract top-tier teaching and research talent from around the globe.
On the labor front, the government will prioritize the employment of local workers, strengthen protections for digital platform workers, and enhance occupational safety and health. A new formula for the annual review of the Statutory Minimum Wage rate is set to take effect on May 1, 2026, reflecting the administration’s commitment to fair labor practices.
Poverty alleviation remains a priority, with 180 million Hong Kong dollars (about 23.14 million U.S. dollars) earmarked for the Child Development Fund to support disadvantaged upper primary students. Measures to boost fertility include extending the claim period for the additional child allowance from one to two years and further enhancing infant and child day care services. Other initiatives focus on increasing housing supply, improving elderly care, and supporting rehabilitation services.
Internationally, Lee outlined plans to establish a task force to assist mainland Chinese enterprises in their overseas expansion, leveraging Hong Kong’s overseas offices as a one-stop platform. The government will also support the International Organization for Mediation (IOMed) by organizing conferences, training, and internships to nurture a new generation of mediation professionals.
Despite a 3.1% GDP growth in the second quarter of 2025, Hong Kong faces real challenges: declining retail sales, vacant shops, and an unemployment rate of 3.7%. Tourists are spending less, and many locals now spend weekends across the border in mainland China, drawn by cheaper prices and greater variety. Lee’s policy address, therefore, is not just a roadmap for economic expansion—it’s a bid to restore confidence, revitalize the city, and ensure that prosperity translates into tangible improvements in people’s lives.
As Hong Kong embarks on this new chapter, the success of the Northern Metropolis and the city’s broader reforms will hinge on the government’s ability to deliver on its promises, foster genuine public-private collaboration, and adapt to the evolving needs of its people and the global economy.
