Saudi Arabia's Vision 2030 includes collaborating with Hong Kong to drive economic transformation

The goal is to leverage Hong Kong as a gateway to jumpstart Saudi Arabia's transformation.

Saudi Arabia's Vision 2030 includes collaborating with Hong Kong to drive economic transformation
Hong Kong Chief Executive John Lee speaks during the reception for the 26th anniversary of the establishment of the Hong Kong Special Administrative Region, at the Hong Kong Convention and Exhibition Centre, in Hong Kong, China July 1, 2023. Information Services Department/Handout via REUTERS

The backstory: Saudi Arabia and China have a strong connection in the world of oil. China heavily relies on Saudi Arabia for around 18% of its crude oil purchases, making the kingdom its top oil supplier. In 2016, Saudi Arabia launched an ambitious plan called Vision 2030, aiming to diversify its economy and revenues and reduce its reliance on oil. The plan focuses on sectors such as healthcare, infrastructure, recreation and tourism, with the goal of positioning Saudi Arabia among the top 15 economies in the world by 2030.

Now, let's talk about Hong Kong. The city is actively seeking fresh investment opportunities and strengthening its relationships with regions like the Middle East. For example, last October, Financial Secretary Paul Chan visited Bahrain and Saudi Arabia, aiming to explore potential business ventures. In February, Hong Kong Exchanges and Clearing (HKEX) and the Saudi Tadāwul stock exchange announced plans to collaborate on various fronts, including cross-listings, fintech, ESG (Environmental, Social, and Governance) and more.

More recently: Chinese President Xi Jinping also visited Saudi Arabia in December. The two countries sealed the deal on 34 investment agreements covering stuff like green energy, technology and transportation. These agreements translated into a substantial investment of US$50 billion.

Last month, the 10th Arab-China Business Conference further solidified the commitment to strengthen the two nations' ties, with both sides saying that they wanted to create more investment opportunities and strengthen trade, investment and financial ties.

The development: In a recent interview with the South China Morning Post (SCMP), Abdullah Al-Swaha, Saudi Arabia's Minister of Communications and Information Technology, talked about the country’s plans to team up with Hong Kong and eventually mainland China to give the Vision 2030 reform agenda a major boost. The goal is to leverage Hong Kong as a gateway to jumpstart Saudi Arabia's transformation. The kingdom is eyeing key sectors like fintech, tech entrepreneurship, venture capital funding, health sciences, biotech, the environment, cloud computing, AI (including generative AI) and smart cities for this partnership. Saudi Arabia also wants to tap into China's success in information and communications technology (ICT) and align its Vision 2030 with China's Belt and Road Initiative.

During the event, Hong Kong Chief Executive John Lee announced that the upcoming Belt and Road Summit in the city would feature a dedicated Middle East forum for the first time. This forum in September will facilitate discussions between companies and investors from Belt and Road countries and their counterparts from Saudi Arabia and the Middle East. Lee highlighted the alignment between Saudi Arabia's Vision 2030 and Hong Kong's innovation and technology development blueprint, emphasizing Hong Kong's commitment to becoming an international hub in these fields.

Key comments:

“[Hong Kong and Saudi Arabia] are going through very promising transformations, where both economies are financial hubs in their own regions,” said Abdullah Al-Swaha to SCMP. “We have an opportunity to build an innovation bridge, to leapfrog into the future with an innovation-based economy.”

“The current term of the Hong Kong government has put a priority on revitalising our relations with Saudi Arabia – and the Middle East in general,” said Chief Executive John Lee during a gala dinner at the Hong Kong Science and Technology Park (HKSTP).

“This agreement signals the beginning of even greater collaboration between our companies and our home markets, and we look forward to exploring many future areas of cooperation,” said HKEX CEO Nicolas Aguzin, referring to the agreement with Saudi Tadāwul Group.