Chief Executive John Lee on Tuesday said he expects half of Hong Kong's companies would be using artificial intelligence by the end of this year, adding that technology and innovation is the government's priority.

Speaking at the UBS Asian Investment Conference, Lee said the SAR understands the important role technology plays in the future of investment.

"Thanks to the unique 'One Country, Two Systems' principle, Hong Kong continues to evolve. As we embrace new technologies and sustainable practices, we strengthen our position as the foreign investment gateway to mainland China, and as the conduit for mainland enterprises to invest in the world," he said.

"Technology and innovation is a central priority of the Hong Kong SAR government. That includes applying AI technology to fast track our smart city and digital government ambitions."

Lee added the government was launching more than 100 digital government and smart-city initiatives and expediting the establishment of an AI Supercomputing Centre in Cyberport.