Hong Kong's Low-Altitude Economy: Drones, AI, and the Future of Logistics

Hong Kong is rapidly transforming into a smart city, and a key component of this transformation is the burgeoning low-altitude economy (LAE). This innovative sector, centered around drone technology and aerial logistics, is poised to reshape the city's economic landscape and create new opportunities for businesses and residents alike. With strategic government initiatives and the support of innovation hubs like Cyberport, Hong Kong is aiming to become a leader in the LAE, leveraging its existing strengths in logistics and finance.

The low-altitude economy encompasses all economic activities conducted in the airspace below a certain altitude, typically involving unmanned aerial vehicles (UAVs) or drones. This includes a wide range of applications, such as package delivery, infrastructure inspection, emergency response, and even passenger transport. The LAE promises to improve efficiency, reduce costs, and enhance accessibility in various sectors, making it a key driver of economic growth and innovation.

Cyberport is playing a crucial role in fostering the growth of Hong Kong's LAE. As the venue partner for the government's Low-Altitude Economy Regulatory Sandbox Pilot Programme, Cyberport provides a dedicated testing ground for drone technologies and applications. Its strategic location, close to the coastline and away from busy maritime routes, makes it an ideal environment for drone operations. Cyberport offers a range of facilities, including dedicated testing grounds, flight spaces, and robust data infrastructure, to support pilot projects and accelerate innovation in the LAE. Cyberport's COO, Howard Cheng, emphasizes the importance of aligning the LAE with international standards and fostering business matchmaking opportunities for park companies.

The Hong Kong government is actively supporting the development of the LAE through various initiatives and regulatory frameworks. The Low-Altitude Economy Regulatory Sandbox Pilot Programme, launched in mid to late 2025, includes 38 trial projects spanning emergency response, cargo delivery, and infrastructure maintenance. These projects are designed to showcase the potential of the LAE and inform future regulations. Secretary for Transport and Logistics, Mable Chan, highlights Hong Kong's strategic positioning as a global logistics and financial hub, making it a natural incubator for the LAE. The government believes that the LAE can create enormous business opportunities, stimulate technological innovation, and offer young people hope and job opportunities.

Phoenix Wings, a leading drone logistics company from Mainland China, is bringing its expertise to Hong Kong. The company's Regional Sales Director, Xuan Junhui, explains how drones can dramatically reduce delivery times, particularly for routes that are difficult to access by traditional means. For example, a ferry route from Lamma Island to Cheung Chau can take hours, while a drone can make the trip in just 20 minutes. Phoenix Wings is leveraging Cyberport's infrastructure and coastal environment to test its drones in adverse weather conditions and lay the groundwork for expanding drone applications to urban areas.

Jumppoint is using artificial intelligence (AI) to revolutionize traditional logistics and optimize delivery routes. CEO Samson Ho details how their proprietary algorithms have boosted delivery capacity from 1.5 to 8.3 orders per hour per driver, significantly lowering operational costs. The company's AI-powered route planning enables 48-hour cross-border delivery to Southeast Asia and 2–5-day international service. Jumppoint credits Cyberport for providing vital resources and community connections, enabling them to compete globally.

While the low-altitude economy presents significant opportunities, it also faces several challenges. These include regulatory hurdles, safety concerns, and public acceptance. Addressing these challenges will require collaboration between government, industry, and the public to develop clear regulations, ensure safe operations, and build trust in drone technology. Overcoming these obstacles will unlock the full potential of the LAE and pave the way for widespread adoption of drone-based services.

The future of Hong Kong's low-altitude economy looks promising. With ongoing government support, the development of robust infrastructure, and the emergence of innovative companies like Phoenix Wings and Jumppoint, the city is well-positioned to become a leader in this emerging sector. As drone technology continues to advance and regulations become more refined, we can expect to see even more applications of drones in various aspects of daily life, from package delivery to infrastructure inspection to emergency response. The LAE has the potential to transform Hong Kong into a more efficient, sustainable, and connected city.