The evolution of artificial intelligence (AI) has changed abruptly, the most recent disruption coming from the emergence of generative artificial intelligence (GAI). GAI goes leaps and bounds beyond the standard AI systems that only organize information and make projections, as it additionally comes up with new documents from scratch. It is a significant turning point since GAI can generate text, images, videos, and other types of content thanks to algorithms and deep learning models. The technology is already proving useful to business enterprises that want to automate processes ranging from content production to site design.
Regional Adoption and Industry Ecosystems
The rate of adoption is accelerating exponentially, especially in Asia. As per the report from The China Internet Network Information Center (CNNIC) for 2024, GAI product users in China reached 230 million by last June. “GAI’s growing popularity among internet users is greatly impacting their lives,” said Liu Yulin, director of CNNIC. China boasts a complete AI industry ecosystem, comprising over 4,500 relevant firms. Hong Kong is also enjoying rapid inclusion; a survey from Finastra recently stated that 38% of institutions there have started implementation of GAI, which is the highest figure among the surveyed markets and considerably more than the global average of 26%. In banking, GAI is increasingly being employed for data analysis and servicing employees through chatbots, as reported by KPMG last July.
The Growing Call for Regulation
With GAI increasing productivity and opening new frontiers, the need for boundaries to be set is equally as critical throughout operations. For businesses, this means compliance with established industry standards and creating clear-cut protective measures. There must be proactive self-regulation, but innovation should not be choked, so it becomes essential to have strong protective measures that encourage advancement.
The Proactive Regulatory Approach of Hong Kong
Hong Kong is ahead of the curve. AI Governance Frameworks for Responsible Artificial Intelligence (GAI) were issued by Digital Policy Commissioner Tony Wong Chi-kwong on April 15 as part of the Greater Bay Area (GBA) Digital Economy Strategy at the World Internet Conference Asia-Pacific Summit in Hong Kong. This follows the SAR Government’s “Innovation and Technology Blueprint’ for the region in the next 5-10 years, where Hong Kong will become an “I&T international center” working towards a “secure cyberspace.” Properly managed AI is part of this blueprint.
The guidelines address potential exploitation for illegal activities such as producing explosive devices, generating obscene content, or creating content that deceives or disrupts public order. This comes after studying various models of AI governance and consulting with experts in the field. Wong pitched the guidelines and hoped they would “facilitate the industry and the public in developing and applying generative AI in a safe and responsible manner while fostering the risk-mitigating environment for the adoption of generative AI in Hong Kong.” We’re built upon a four-tier classification system. The Hong Kong Monetary Authority (HKMA) is also separately working on a regulatory-hybrid sandbox approach for financial institutions to benchmark GAI functions under safe supervisory testing.
Oversight and Risk Management.
The most threatening GAI risks, including those affecting national security, could be uncontrolled. There is much reason for concern considering how it can be misused. Proper control measures are needed to minimize such threats. Without proper oversight, GAI could foster an “anything goes” environment that encourages unrestricted usage.
Chinese Federal Government’s Attention on AI Development and Regulation.
China’s AI focus has become increasingly important as of late. DeepSeek and other tools fueled discussions around AI during the Annual Two Sessions in Beijing, which concluded on March 11. The government work report focused more on industrial development, expressing usages of AI in construction, such as “embodied” AI and robots. There was discussion on regulation gaps concerning the AI misuse and fueled calls for more robust governance.
Hong Kong Privacy Commissioner Initiatives
Hong Kong SAR and Privacy Commissioner for Personal Data Ada Chung Lai-ling has been responsible for implementing changes to AI safeguards, addressing the risks to personal information and ensuring compliance with the Personal Data (Privacy) Ordinance Cap 486. Chung has published recommendations on data stewardship and ethical AI principles, and published guidelines on the use of generative AI by employees, emphasizing risk management, privacy, and enforcing punitive measures for breaches.
Balancing Development and Security
While commenting, Chung noted that China considers development and security simultaneously during the application of AI. She stated that “AI security is one of the most important aspects of national security,” which was “incontrovertible.” Indeed, while GAI holds benefits, there is risk in the hands of “malign actors” who may use it for “anti-state activities.”
With the proliferation of GAI, practical considerations will remain under constant scrutiny. Development cannot infringe on public safety, personal rights, or the safety of the market. So, Hong Kong aims for what the Digital Office Commission calls a “pragmatic balance strategy” in terms of formulating regulations. This strategy mitigates the concerns without stopping legitimate technological progress, allowing Hong Kong to emerge as the leading regional responsible GAI pioneer.
