The Hong Kong government released this morning (28th) a policy statement on responsible application of artificial intelligence (AI) in the financial market.

The statement mentioned that the government will adopt a dual-track approach to promote development of AI adoption by the financial services sector, while at the same time addressing the potential challenges, such as cybersecurity, data privacy and protection of intellectual property rights.

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In addition, financial institutions should formulate an AI governance strategy to provide direction on how AI systems should be implemented and used. A risk-based approach should be adopted in the procurement, use and management of AI systems and human oversight will be crucial to mitigating the potential risks.

The Hong Kong University of Science and Technology will also make its self-developed AI model and its computing resources available to Hong Kong's financial services industry, and offer advisory and training services for on-premises deployment or Application Programming Interface and Web Interface options.

As for financial regulatees, the potential risks posed by AI have been suitably reflected in the relevant regulations and/or guidelines issued by financial regulators. To keep pace with the latest developments of AI and international practice, such as the emergence of explainable AI, financial regulators will continuously review and update the existing regulations and/or guidelines as appropriate.

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On public education, the Investor and Financial Education Council will raise public awareness and enhance understanding on the opportunities and risks presented by AI technology in terms of retail investing and financial management.

As an international financial center, Financial Secretary Paul Chan said that Hong Kong's financial market is open and prudent towards the application of AI. The policy statement clearly sets out the government's policy stance and approach towards the responsible application of AI in the financial market.

Chan added that as the AI technology is constantly evolving, the government will closely monitor market developments, draw on the Mainland and overseas experience, and fully leverage the unique advantages of Hong Kong in bringing together the Mainland and international data as well as the free flow of information, in promoting the use of AI in the financial sector for accelerating the development of new quality productive forces tailored to local conditions.

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