TLDR:
Saudi firms eye Hong Kong listings.
A boost for Gulf-HK economic ties.
Tadawul, PIF explore new opportunities.
HONG KONG (The Thursday Times) — Saudi companies, including those linked to the Public Investment Fund (PIF) and already listed on Tadawul, are considering listing on the Hong Kong Stock Exchange (HKEX), signalling a significant development in Gulf-Asia financial collaboration. This potential move reflects Saudi Arabia’s drive to diversify its economy and Hong Kong’s ambition to strengthen its role as a global financial hub.
Expanding financial horizons
The idea of Saudi firms listing in Hong Kong was highlighted by Carlson Tong Ka-shing, Chairman of HKEX, during the 8th Future Investment Initiative (FII) summit held in Riyadh. This collaborative vision could provide Saudi businesses with access to new capital markets while granting Hong Kong and global investors unprecedented exposure to the Gulf economy.
Tong described the potential listings as a “win-win situation,” where Saudi companies can bolster their economic diversification efforts and Hong Kong can enhance its appeal as a gateway to the Middle East. This initiative also underlines the Kingdom’s broader economic transformation goals under Vision 2030, aiming to reduce its reliance on oil revenues.
Bridging Gulf and Asian markets
The FII summit brought together a 110-member delegation from Hong Kong, led by Financial Secretary Paul Chan Mo-po, to explore new financial ties with the Gulf. The discussions included innovative steps like the listing of two exchange-traded funds (ETFs) worth $1.8 billion on Tadawul, enabling Middle Eastern investors to trade Hong Kong stocks for the first time.
Such steps are viewed as symbolic of the deeper integration of Gulf and Asian financial markets. For Saudi companies, listing in Hong Kong represents a strategic opportunity to tap into a broader, diversified investor base while leveraging the region’s thriving financial ecosystem.
Hong Kong’s financial magnetism
Hong Kong’s position as a global financial hub stems from its robust infrastructure, favourable regulatory environment, and strategic geographical location bridging East and West. The city has consistently attracted international capital, and the inclusion of Saudi firms could further cement its reputation.
For Saudi firms, a dual listing on Tadawul and HKEX would offer distinct advantages. It would not only open doors to Asian capital markets but also reinforce their visibility in global financial circles, enhancing liquidity and market confidence.
Vision 2030 meets Asia
The potential listings align seamlessly with Saudi Arabia’s Vision 2030 goals, which prioritise economic diversification and foreign investment. By fostering ties with global financial hubs like Hong Kong, Saudi Arabia aims to showcase its evolving economic landscape to international investors.
At the same time, Hong Kong is positioning itself as the preferred partner for Gulf economies looking to expand their financial reach. Initiatives like ETFs and prospective Saudi listings illustrate a mutual commitment to leveraging each other’s strengths.
Strengthening cross-border investments
The collaboration between Tadawul and HKEX could set a precedent for more cross-border financial activities between the Gulf and Asia. Both regions share ambitions of fostering innovation and sustainability in their financial sectors. By linking their markets, they can create a platform for joint ventures, strategic investments, and deeper economic cooperation.
The involvement of the PIF, Saudi Arabia’s sovereign wealth fund, in these listings could serve as a catalyst for further Gulf-Asia partnerships. Known for its aggressive global investment strategy, the PIF’s participation underscores the seriousness of this initiative.
