Jerry Li, managing and founding partner of eWTP Arabia Capital. (PROVIDED TO CHINA DAILY)
In reaffirming its position as an international financial hub and a gateway to doing business in the Chinese mainland, the Hong Kong Special Administrative Region will play a more prominent role in bringing China and the Gulf countries closer together.
Jerry Li, managing and founding partner of eWTP Arabia Capital, or eWTPA, a venture capital firm based in Beijing and Riyadh, Saudi Arabia, cited Hong Kong’s “very special position” for easily attracting “a lot of foreign countries” to open their offices in Hong Kong first – be they for trade or attracting talent.
The city’s exposure to the international community is seen as an advantage in facilitating the opening-up of the Chinese mainland to the Gulf countries
The city’s exposure to the international community is seen as an advantage in facilitating the opening-up of the Chinese mainland to the Gulf countries – Saudi Arabia, the United Arab Emirates, Oman, Bahrain, Kuwait and Qatar – which Li said “means big potential”.
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“This is a special region. (When) doing business, we need the relationship first…We need to think about each other. Of course, the culture is so different so we always need to know more about what they are thinking. But generally speaking, (the Gulf) is a very good market.”
With Hong Kong’s deeper integration with the other cities in the Guangdong-Hong Kong-Macao Greater Bay Area, Li urged the business communities in the GBA to “pay more attention to the local environment” in the Gulf countries given the different culture and business landscape.
The GBA comprises the two special administrative regions of Hong Kong and Macao, as well as the nine municipalities of Guangzhou, Shenzhen, Zhuhai, Foshan, Huizhou, Dongguan, Zhongshan, Jiangmen and Zhaoqing, in Guangdong province.
According to the GBA website, the total population in the area is over 86 million, with gross domestic product hitting $1.67 trillion in 2020.
Hong Kong Financial Secretary Paul Chan Mo-po, who is attending the World Economic Forum in Davos, Switzerland, said the city’s financial markets are deepening and broadening with the continuous expansion and development of the mutual market access programs with the mainland, better converging international and mainland capital.
In Davos, Chan also met with Saudi Arabia’s Finance Minister Mohammed Al-Jadaan, and explained the SAR’s latest directions and prospects of development, indicating the city could help countries in the Middle East to diversify their investments and manage risks.
The Gulf countries have been working to diversify their economies, such as under Saudi Arabia’s Vision 2030, for example.
China is Saudi Arabia’s largest trading partner, and Saudi Arabia is China’s important energy supplier and largest trading partner within the West Asia and Africa region. The trade volume between the two countries reached $87.31 billion in 2021, up 30.1 percent year-on-year, according to the Chinese Foreign Ministry.
Last month, eWTPA, with Li as representative and on behalf of the leading Chinese gaming company OneMT, signed an investment agreement with Deputy Minister of Investment Saleh Khabti at the Ministry of Investment in the Saudi capital. It is part of Vision 2030’s support to enhancing its gaming and entertainment sector
eWTPA is backed by Chinese e-commerce giant Alibaba’s eWTP Capital and Saudi Arabia’s sovereign wealth fund the Public Investment Fund. It positions itself as a bridge connecting Chinese companies and emerging markets such as the Middle East and North Africa.
Li said that after President Xi Jinping visited Saudi Arabia in December, “there is a big difference, because right now the Gulf countries, especially Saudi, became the center of the world. And a lot of opportunities and a lot of capital go in there.”
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Li said Saudi Arabia’s Vision 2030 and China’s Belt and Road Initiative are both ambitious and important and benefit a lot of countries. He said his firm’s role is to provide support and help reduce barriers for Chinese businesses wanting to enter the kingdom.
“From the Gulf countries, of course this is also a very good opportunity that can connect the two sides more closely,” he said.
Li’s advice to Chinese companies planning to do business in the Gulf is to find a local partner first and gain the local know-how for doing business in the region.
“Of course, we will also provide a lot of support to helping our partner … so we hope in the future there will be more and more companies that can enter successfully,” he said.