Hong Kong exchange courts Middle East companies

Reuters/Lam Yik

• Hong Kong bourse hopes to entice Saudi Aramco to second listing
• Mainland Chinese stock exchanges accept shares from foreign investors

The Hong Kong stock exchange has renewed its efforts to attract listings by Middle East companies, including Saudi Aramco.

Christopher Hui, secretary for financial services and the treasury in Hong Kong, confirmed interest from Middle Eastern companies during a week-long tour of the region by a 30-strong delegation.

The tour aims to promote Hong Kong to business and political leaders from the Arab region.

Last December the China Securities Regulatory Commission (CSRC) and the Hong Kong Securities and Futures Commission (SFC) announced plans to expand the scope of eligible stocks under the mainland China-Hong Kong Stock Connect scheme.

The trading platform now enables domestic mainland Chinese stock exchanges to accept shares from international investors and vice versa.

• Hong Kong eyes free trade deal with the UAE
• Saudi Aramco’s Luberef expects to raise up to $1.32bn from IPO
• China to set up Gulf free trade zone ‘as soon as possible’

Hui said 13 percent of daily turnover is attributed to liquidity from mainland China to the north of Kong Kong.

“The appeal of listing in Hong Kong to international investors is not just about liquidity in Hong Kong, but also liquidity from the north,” he said.

John Lee, the leader of Hong Kong, held talks with Saudi Aramco this week in a bid to entice the energy giant into a secondary listing on the city’s bourse (HKEX).

Lee met Aramco CEO Amin Hassan Nasser at the Leap 2023 tech conference in Riyadh where he pledged the support of HKEX should Aramco choose to list.

This move follows a visit to the Saudi capital by Hong Kong financial secretary Paul Chan Mo-po last October as Hong Kong vies for listing status against New York and London.

Hui said the meetings involved discussion about the equity side of a listing and the “comprehensive financial and professional services that Hong Kong can offer to serve the needs of quality issuers like Aramco”.

He added that it was “an ongoing process” and ultimately “a decision for the issuer”. Saudi Aramco was contacted for comment.

Aramco raised $29 billion in its initial public offering in Riyadh in 2019 and became the most valuable listed company in history as its market value hit $1.9 trillion on its first day of trading.

During this week’s visit the HKEX and Saudi Tadawul, the kingdom’s bourse, signed a deal to explore cooperation opportunities in fintech, cross listings and issues related to Environmental, Social and Governance (ESG), as well as other areas of interest to both exchanges.

HKEX chief executive officer Nicolas Aguzin said: “The kingdom of Saudi Arabia, and the broader Middle Eastern region, are one of the world’s most dynamic and exciting economic and innovation hubs and also home to some of the fastest growing investor groups in the world.”