Hong Kong's Economic Offensive in the Middle East: Billion-Dollar Deals with Saudi Arabia

Hong Kong has secured billions of dollars in financial support from Saudi Arabia. This was achieved by one of the city's largest business delegations, which signed nearly a dozen agreements for start-ups and cooperation deals within just three days. The highlight of the week was undoubtedly the one billion US dollar agreement announced on the last day of the 2024 FII Summit. The Saudi sovereign wealth fund and the Hong Kong Monetary Authority agreed to support companies from the Greater Bay Area—including Hong Kong—that are seeking to expand into the Middle East. Two days earlier, a Saudi incubator had agreed to grant start-ups from the Hong Kong Science and Technology Parks (HKSTP) access to its 300 million dollar fund to promote their expertise in artificial intelligence, food technology, and biomedical science. Additionally, two exchange-traded funds (ETFs) with a total value of 1.8 billion US dollars were traded on the Tadawul stock exchange this week, providing investors from the Middle East access to Hong Kong's listed companies. "It doesn't stop at mere words," said Financial Secretary Paul Chan Mo-po at a media briefing in Riyadh. "We've seen more than 10 multi-million-dollar deals in the last three days. Many investors from the Middle East are showing great interest in investing in Hong Kong and Chinese companies." This successful trip of 110 officials, executives, and start-ups led by Chan was the culmination of two years of bilateral exchanges between Hong Kong and Saudi Arabia, which began in February 2023 with the Chief Executive John Lee Ka-chiu's visit to Riyadh. Appropriately, Cathay Pacific Airways resumed its direct flight between Hong Kong and Riyadh this week, which had been suspended since 2017. The direct flight reduces the travel time between the two cities by about five hours to a total of nine hours, Chan reported after his flight on this route on Monday. Cathay Pacific is currently in codeshare negotiations with Riyadh Air to expand their respective route networks following the multi-billion-dollar order of 60 Airbus aircraft by Saudi Arabia's second-largest airline.