With the aim of further strengthening two-way capital flows, Hong Kong is working with Saudi Arabia and several financial institutions to develop an exchange-traded fund that tracks Hong Kong stock indices.

The announcement regarding the tracker fund was made by Hong Kong financial secretary Paul Chan Mo-po during the inaugural international Capital Markets Forum in Hong Kong, where he also reaffirmed the government’s commitment to its partnership with Saudi Arabia, noting, among other things, that the territory’s Cathay Pacific Airways is expected to relaunch direct passenger flights between Hong Kong and the Saudi capital of Riyadh in the fourth quarter of this year.

The secretary also referenced formal negotiations for an investment promotion and protection agreement between both nations, with the Hong Kong government considering establishing an economic and trade office in Riyadh.

As well, the China Securities Regulatory Commission, Chan notes, has announced a series of measures to further expand mutual access making it even easier for Saudi companies to access Chinese capital, adding that, under the mutual market access schemes, Hong Kong is developing more RMB denominated investment and risk management products.

“The friendship and partnership between Hong Kong and Saudi Arabia,” Chan states, “will go very far and will endure the test of time.”