Chief Executive John Lee Ka-chiu (second left) tours "THE LINE Experience" exhibition to learn about the innovative urban designs of the futuristic city NEOM in Riyadh, Saudi Arabia, on Feb 5, 2023, during his visit to Saudi Arabia as part of his Middle East tour. (PHOTO / HKSAR GOVERNMENT)
The business and finance community in Hong Kong hope that the high-level profile visit to Saudi Arabia by senior officials from the Hong Kong Special Administrative Region government can persuade more Middle East companies to consider listing in Hong Kong and also attract more Middle Eastern investors to invest in Hong Kong.
“As of the end of 2022, we have around 2,600 companies listed on the Hong Kong Stock Exchange with total market capitalization of over HK$35 trillion ($4.48 trillion), including pan-Asian insurer AIA Group and Budweiser Brewing Company APAC,” said Cliff Ip, Greater China deputy president at CPA Australia.
“Together with the recent further expansion of Stock Connect that allows eligible shares of international companies that are primary-listed in Hong Kong to be included in southbound trading, Hong Kong is well-prepared to attract Middle East companies to come to Hong Kong and achieve long-term win-win collaborations,” Ip told China Daily.
Hong Kong Exchanges and Clearing, operator of the Hong Kong Stock Exchange, on Monday announced it has signed a memorandum of understanding with the Saudi Tadawul Group Holding Company, the stock exchange operator in Saudi Arabia. The MOU seeks to explore cooperation opportunities in fintech, environmental, social and governance (ESG) and cross listings, as well as a number of other areas of interest to both exchanges.
ALSO READ: HKEX signs cooperation deal with Saudi Tadawul
Together with the recent further expansion of Stock Connect that allows eligible shares of international companies that are primary-listed in Hong Kong to be included in southbound trading, Hong Kong is well-prepared to attract Middle East companies to come to Hong Kong and achieve long-term win-win collaboration.
Cliff Ip, Greater China deputy president at CPA Australia
“The MOU reflects HKEX’s ongoing commitment to driving global connectivity and shaping a successful shared sustainable future. Hong Kong and HKEX’s markets offer significant opportunities for international investors and corporates, including unrivalled connectivity to the mainland markets through our unique Connect programs,” HKEX Chief Executive Officer Nicolas Aguzin said in the HKEX statement.
“We are seeing increased interest from issuers and investors in Asia. This MOU brings us one step closer towards enabling cross listings and other areas of collaboration between Saudi Arabia and Hong Kong,” Saudi Tadawul Group Chief Executive Officer Khalid Al Hussan added.
Chief Executive John Lee Ka-chiu concluded the first day of his visit to Saudi Arabia by meeting Khalid Al-Falih, minister of investment of Saudi Arabia, and Turqi A Al-Nowaiser, deputy governor of Saudi Arabia’s sovereign wealth fund Public Investment Fund.
The chief executive announced that Hong Kong and Saudi Arabia will launch formal negotiations on an investment promotion and protection agreement (IPPA) that will strengthen investor confidence and increase bilateral investment flows.
READ MORE: CE hails 'new level' of Saudi-HK ties; 6 pacts signed
Enterprises or organizations from Hong Kong and Saudi Arabia exchanged six MOUs or letters of intent, covering finance, innovation technology, business, transportation and energy.