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A New Chapter of Hong Kong-Middle East Cooperation in Finance and Innovation

Yesterday, I met with several friends who recently moved to Hong Kong and attended the Wine and Dine Festival at the Central Harbourfront, where we enjoyed wines and local delicacies from around the world. While admiring the beautiful views of Victoria Harbour, we happily chatted and shared our respective culinary cultures with other participants from both local and overseas, all of whom could feel Hong Kong's vibrant lifestyle and cultural diversity.

Face-to-face interactions and exchanges enable us to better understand each other's thoughts and perspectives. They also allow us to showcase Hong Kong's unique characteristics of being free and open, with a blend of Eastern and Western cultures and vast development opportunities. Building friendships with more people from around the world also helps to advance cross-regional cooperation in trade and innovation, as well as cultural exchange.

Yesterday, I met with several friends who recently moved to Hong Kong and experienced the vibrant lifestyle and rich cultural diversity of the city at the Wine and Dine Festival.

Tomorrow, I will lead a business delegation comprising representatives from the financial services and innovation sectors to Riyadh, Saudi Arabia, for a three-day visit. This time, we will attend the eighth edition of the Future Investment Initiative (FII) and promote deeper exchanges and discussions between Hong Kong's financial and innovation sectors, and relevant institutions and representatives from the Middle East, through a series of activities, including bilateral meetings, breakfast meetings, roundtable discussions, and cross-sector investment presentations. These are expected to help Hong Kong businesses expand their networks in Saudi Arabia and other Gulf countries, making future business development and collaboration more focused and convenient.

This trip to Riyadh is particularly meaningful as we will be taking the first direct flight resuming after over four years of suspension due to the pandemic. It symbolises a closer connection between Hong Kong and Saudi Arabia, and marks a new phase of deeper and more diverse cooperation between Hong Kong and the Middle East.

One of the key activities during this visit will be witnessing the listing of the first two exchange-traded funds (ETFs) tracking Hong Kong stocks on the Saudi Exchange. This means that Saudi investors will be able to invest in the Hong Kong stock market more conveniently, through locally-listed ETFs in a trading and regulatory environment familiar to them.

In fact, at the end of last year, we facilitated the listing of the first ETF tracking Saudi stocks in Hong Kong, enabling Hong Kong funds to invest in the Saudi market. A year later, we are welcoming larger-scale Hong Kong stock ETFs to be listed in Saudi Arabia, which showcases the mutual flow of funds between the two markets, and enriches the financial connectivity under the Belt and Road Initiative. It is anticipated that after the listing of these two Hong Kong stock ETFs, more bilateral financial products will be introduced, boosting the flow of funds between the two regions and gathering more capital from the Middle East for the Hong Kong market. They will also allow investors in the region to become more familiar with our market.

Another focus of this visit is to accelerate and deepen cooperation in innovation and technology between the two regions. In recent years, Saudi Arabia has engaged in its Vision 2030 to promote diversified economic development, and is committed to attracting more overseas investments as well as technological input for various types of projects. This time, companies from the Hong Kong Science and Technology Parks will bring over 20 tech startups and stage roadshows in Saudi Arabia, while partners from the Hong Kong Investment Corporation Limited will also participate in some of the activities to showcase the achievements of Hong Kong's robust innovation and technology development, along with an increasingly comprehensive innovation ecosystem. They will engage in exchanges with Saudi investment institutions. This is expected to help businesses explore more opportunities for collaboration.

Yesterday, I met with several friends who recently moved to Hong Kong and experienced the vibrant lifestyle and rich cultural diversity of the city at the Wine and Dine Festival.

In a photo with other members of the public at the Wine and Dine Festival.

The theme of this year's FII is "Infinite Horizons: Investing Today, Shaping Tomorrow", and the event will gather important political and business leaders from the Middle East and around the world to discuss how to use investment to drive a more prosperous and sustainable future for humanity. Many members of the delegation, including myself, will speak at the plenary and other sub-forums. We aim to showcase Hong Kong's highly internationalised character, and its unique role and advantages as a "super connector" and "super value-adder" under the "one country, two systems" arrangement. We will actively telling the good stories of China and Hong Kong.

Reflecting on the past few years, it is evident that building friendships, reinforcing trust, and pursuing win-win outcomes can foster more interactive exchanges and cooperation with the Middle Eastern market. The Hong Kong SAR Government team visited the Middle East multiple times over the past two years, including my participation at the FII meeting in Saudi Arabia in 2022, where we successfully lobbied for the first FII Priority Asia Summit to be held in Hong Kong last year, during which the first Saudi ETF was listed on the Hong Kong Stock Exchange. And now, it has come to the listing of Hong Kong stock ETFs in the region. This step-by-step progress involved the efforts and dedication of many friends and institutions from various sectors. Development always has its process; by engaging in deeper and broader bilateral exchanges and mutually beneficial development, we can gradually open up new dimensions for Hong Kong businesses to expand into overseas regions, and attract more long-term funding sources for the Hong Kong market. All these will solidify Hong Kong's position as an international financial, shipping and trade centre.

October 27, 2024