Hong Kong and Saudi Arabia to boost financial services integration

Saudi Arabia’s Central Bank (SAMA) and the Hong Kong Monetary Authority (HKMA) recently held a meeting to discuss ways of boosting financial services integration and cooperation. 

The July 27 meeting aimed to strengthen the partnership between Saudi Arabia and Hong Kong and enhance their financial systems.

The focus was also to agree on tokenization and payment infrastructure.

Saudi Arabia and Hong Kong discussion

SAMA and HKMA representatives discussed four key focus areas, mainly financial infrastructure development, open market operations, market connectivity, and sustainable development.

They also explored supervisory technologies, such as artificial intelligence, machine learning, tokenization, and payment infrastructure. 

SAMA and HKMA signed a Memorandum of Understanding (MoU) to collaborate on financial innovation to facilitate joint deliberations.

The agreement was signed by SAMA’s governor, Mr. Ayman Alsayari, and HKMA’s chief executive, Eddie Yue.

Although the announcement covers financial trends, the press release did not specify whether the collaboration would encompass joint initiatives concerning cryptocurrencies such as Bitcoin (BTC).

However, it still holds weight in crypto. This is considering HKMA’s partnership with the UAE central bank on May 30 aimed at strengthening cooperation on virtual asset regulations and developments.

Hong Kong an emerging crypto hub

As reported by Bloomberg, Hong Kong plans to become a crypto hub. 

In late May, Christopher Hui, Hong Kong’s treasury chief said retail investors can engage in crypto trading since virtual assets are here to stay. 

Hong Kong is also actively involved in multiple cross-border tokenization projects, including the successful launch of a $28 million tokenized security in mid-June by BOCI, the investment bank subsidiary of the Bank of China, utilizing Ethereum. 

As a result, discussions of advancing Fintech naturally lead to conversations around decentralized finance and virtual currencies. 

Although Hong Kong is open to supporting crypto-assets, the government of Saudi Arabia has made it clear that they do not wish to promote the use of cryptocurrencies. 

Their most recent statement was issued in 2019, warning that Bitcoin does not hold official recognition by legal entities within the country. As a result, the extent to which these measures will affect the crypto community remains to be seen.