Industry experts weigh in how Hong Kong businesses can expand into the Middle East

Sep 16, 2024

Cover Over 300 guests attended the forum which marks the first anniversary of Hong Kong Ambassadors Club (HKAC), including Hong Kong Chief Executive Lee Ka-chiu, co-founders of HKAC Jeffrey Lam and Patrick Tsang, as well as leaders from business and government sectors (Photo: Hong Kong Ambassadors Club)

Over 300 guests attended the forum which marks the first anniversary of Hong Kong Ambassadors Club (HKAC), including Hong Kong Chief Executive Lee Ka-chiu, co-founders of HKAC Jeffrey Lam and Patrick Tsang, as well as leaders from business and government sectors (Photo: Hong Kong Ambassadors Club)

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Government and business leaders provide insights for Hong Kong companies looking to enter the Middle East market under Beijing’s Belt and Road Initiative at a forum commemorating the first anniversary of the Hong Kong Ambassadors Club

In 2013, the Chinese government introduced the Belt and Road Initiative, also known as the One Belt and One Road Initiative or the New Silk Road, as its most extensive infrastructure plan to connect and boost trade among Asia, Europe and Africa.

Recognising the Middle East’s growing economic significance, Hong Kong has long positioned the region as a key strategic partner. This strategy aligns with Hong Kong's aim to connect the region with mainland China. Bilateral trade between the two markets reached US$26.6 billion last year, demonstrating a robust 9.5% annual growth over the past five years.

The Hong Kong Ambassadors Club (HKAC), a non-profit organisation that aims to foster connectivity between Hong Kong businesses and other markets, marked its first anniversary with a forum at the Four Seasons Hotel featuring discussions and insights by government leaders and business owners. We highlight some of their top advice to local companies exploring the Middle East.

Keeping up with government initiatives

Above Hong Kong Chief Executive Lee gives a keynote speech at the forum (Photo: Hong Kong Ambassadors Club)

Hong Kong Chief Executive Lee gives a keynote speech at the forum (Photo: Hong Kong Ambassadors Club)

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During a keynote speech, John Lee Ka-chiu, the Chief Executive of Hong Kong, highlighted several upcoming plans to enhance cooperation between the city and the region.

The government is in a discussion with Saudi Arabia on the Investment Promotion and Protection Agreement. He noted that such agreements have already been signed with countries such as Kuwait and Bahrain and had increased confidence among businesses and investors in those regions.

Plans are underway to establish an Economic and Trade Office in Riyadh, the capital of Saudi Arabia, to support the region better and facilitate Hong Kong businesses’ expansion into the Middle East market.

A focus on sustainability

Several regional governments in the Middle East, including the United Arab Emirates, are increasing their focus on green energy and digital transformation, thus presenting numerous investment and trading opportunities for Hong Kong business leaders.

Victor Lee, the founder and CEO of Rice Robotics, known for developing autonomous indoor service robots, revealed at the event that his company had collaborated with one of the governments in the region to incorporate its technology into its green initiatives, such as developing energy-efficient robotic solutions that could reduce carbon footprint.

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“The challenge lies with balancing innovation with cost-effectiveness,” Lee, a Leader of Tomorrow 2021, said. “Compared to three to five years ago, specifications on hardware, transmission, robotic product, the efficiency has grown significantly. So we’re also adopting and continuing to upgrade our technology to make sure our product is super cost-effective.”

Understanding cultural nuances

“The Middle East is known for its diverse regulatory environment and cultural dynamics. Companies looking to move their operations from Hong Kong to this region need to be prepared to navigate these complexities,” shared Jonathan Lamport, CEO of A-Grade Energy, at a panel discussion.

Lamport said that Hong Kong companies should establish strong partnerships in the Middle East to gain insights into customs and local customers’ behaviours, enabling them to adapt their business to the region’s market. “We always say in Chinese: before we do business, be friends first.”

Leveraging facilitation programmes

Lamport suggested that one way to explore the region is to participate in facilitation programs, such as delegation, which enable business owners to interact directly with local authorities or potential partners.

He attended events organised by HKAC, eventually opening doors for his company to enter the region. In the past few years, the group led seven delegations to various areas, including Dubai and Abu Dhabi in the United Arab Emirates, Saudi Arabia, Kuwait and Bahrain.

His renewable energy material and technology company and Hong Kong-based family office Tsangs Group announced last year that they would enter into a joint venture for solar energy, EV charger and energy storage businesses in the region and a few other markets.

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Topics

Bet and Road Initative Middle East Hong Kong Hong Kong Ambassadors Club Asia

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Industry experts weigh in how Hong Kong businesses can expand into the Middle East

Keeping up with government initiatives

A focus on sustainability

Understanding cultural nuances

Leveraging facilitation programmes