SFC furthers Hong Kong-Saudi Arabia capital market ties on Riyadh visit

The Securities and Futures Commission’s (SFC) Chief Executive Officer (CEO), Ms Julia Leung, its Executive Director of Investment Products, Ms Christina Choi, and other senior SFC delegates met with the top executives of the Capital Market Authority (CMA) and Saudi Tadawul Group (parent company of the Saudi Exchange) in Riyadh, Saudi Arabia, yesterday to strengthen regulatory collaboration on their second business trip to Riyadh in less than six months (Note 1). 

The SFC delegates witnessed the successful cross-listing on the Saudi Exchange of the first Hong Kong exchange-traded fund (ETF) which tracks an index comprising major Stock Connect eligible Hong Kong-listed stocks. They are also on hand to witness the cross-listing of another ETF tracking the city’s flagship equity benchmark today.

“The two Hong Kong ETFs are the first ETFs listed on the local bourse to provide Saudi investors with investment exposure to the Hong Kong market. The cross-listing marks a new milestone in the burgeoning ties between the capital markets of Hong Kong and Saudi Arabia, underscoring Hong Kong’s unique role in facilitating two-way capital flow via the China-Middle East Corridor,” said Ms Leung.

They were part of the Hong Kong delegation to Saudi Arabia led by The Honourable Paul Chan, Financial Secretary of the HKSAR. They were joined by a delegation of Hong Kong industry leaders, including the chairpersons of the Hong Kong Investment Funds Association and the Chinese Asset Management Association of Hong Kong, in the meeting with the CMA’s Chairman His Excellency Mr Mohammed bin Abdullah Elkuwaiz and the Saudi Exchange’s CEO Mr Mohammed Al Rumaih, as well as other senior executives. They discussed the role of Hong Kong as a connector for Saudi corporates, investors and market participants to tap into the broader Asian markets, among other topics.

To raise awareness of the opportunities in the realm of asset and wealth management, the SFC also co-hosted with the CMA an industry roundtable in Riyadh yesterday to connect Saudi Arabian and Hong Kong asset managers. During the roundtable discussion, participants explored how to deepen their partnership in knowledge sharing, capacity building and widening product choices for the investors in both markets.

During the visit, Ms Leung spoke of the importance of digital finance at the Future Investment Initiative (FII) Conference in Riyadh. She also highlighted the use of stablecoins to facilitate cross-border payments by reducing costs, speeding up settlement, and broadening access for both individuals and businesses.

To provide quick reference for Hong Kong asset managers in navigating opportunities for regional market connectivity, the SFC has published a guide on its website to introduce the Saudi Arabian market landscape and how Hong Kong funds can be offered there.

The SFC’s Executive Director of Investment Products Ms Christina Choi (first row, centre) took part in the SFC-CMA asset management industry roundtable in Riyadh.