Hong Kong chief executive John Lee arrived in Riyadh on Sunday and revealed plans to strengthen ties with Saudia Arabia, including efforts to lure oil giant Aramco to list in the city.
On Sunday, Hong Kong leader John Lee arrived in Saudi capital Riyadh for a one-week trip in the Middle East to strengthen ties in the region, including through talks to enhance mutual investment flows.
Of note for the financial sector is the confirmed efforts to lure oil giant Aramco and its subsidiaries to list in Hong Kong to take advantage of its hub status and benefits.
«Saudi Aramco’s businesses are very diversified with its different subsidiaries. I will try my best to encourage them to come to Hong Kong for participation, including listing in the city,» according to an «SCMP» report citing Lee.
HKEX Tailwind
The successful wooing of Aramco – one of the world’s largest listed firms with a market capitalization of around $2 trillion – will be a welcome tailwind for the Hong Kong exchange which has faced a challenging environment in recent years.
In 2022, the Hong Kong Exchanges and Clearing saw a second consecutive year of decline in funds raised from initial public offerings (down 68.4 percent) and the fourth consecutive year of decrease in newly listed companies (down 8.2 percent), according to its annual report.
Investment Agreement
In addition to Aramco, the Hong Kong government will launch negations soon with Saudi officials for an agreement on investment promotion and protection.
Hong Kong has already signed 22 such agreements with other economies including the Association of Southeast Asian Nations (ASEAN), Australia, Canada, France, Japan, Thailand, UAE and UK. Negotiations are also underway to establish this agreement with Iran, Russia and Turkey.
«The negotiations will send a positive signal to the business communities of the two places, and help strengthen investor confidence and expand bilateral investment flows,» according to a government statement.
