An economist says that strengthening education, ensuring competitive salaries and providing quality homes will be key if Hong Kong is to bring back international talent as Chief Executive John Lee prepares to deliver his maiden Policy Address on Wednesday.

Speaking on RTHK's Hong Kong Today programme on Tuesday, Andy Kwan, chair of the ACE Centre for Business and Economic Research said officials had to show that Hong Kong had a positive future at a time when, as he put it, the local economy is "going downhill".

"You have to look at education," he told RTHK's Damon Pang. "We all know that vacancies in international schools are basically very low and trying to get a place in an international school is very competitive.

"If the government is able to make the conditions better, in terms of education, in terms of housing, in terms of pay, I think that will be the main three things the package should be considered."

In order to attract businesses, Kwan said lower tax rates, offering concessions on tax and making it easier to set up operations in Hong Kong would all help.

To help small- and medium-sized local businesses, Kwan said the administration could take steps to bring in more skilled foreign or mainland workers to counteract a reduction in the local labour force.

The chief executive has indicated that measures to attract people and businesses to Hong Kong will be a key part of his policy blueprint. Speaking to an audience of international investors on Monday, Financial Secretary Paul Chan said Lee would introduce highly favourable terms and measures to bring in talent and enterprises.