07/08/23

FINTECH: Hong Kong, Saudi Arabia forge partnership for FinTech innovation

As published on: fintech.global, Monday 7 August, 2023.

The Hong Kong Monetary Authority (HKMA) and the Saudi Central Bank (SAMA) have recently initiated a partnership.

These two entities have signed a Memorandum of Understanding (MoU) to conduct joint studies that aim to advance financial innovation in their respective jurisdictions.

The partnership between the HKMA and SAMA stems from the need to explore and experiment with the best methods to integrate tokenization into their financial systems. With Hong Kong aiming to be a significant hub for digital currencies and Saudi Arabia’s conservative approach, this collaboration seeks to benefit both economies by researching financial innovation, including the possibility of a central bank digital currency (CBDC).

The MoU is broad-ranging, covering key sectors like open market operations, market connectivity, sustainable development, and financial infrastructure development. It also comes on the heels of similar partnerships that the HKMA has entered into with other Middle Eastern countries, like the Central Bank of the United Arab Emirates, to develop digital currency regulations.

Hong Kong is strategically positioning itself as the digital assets global hub. With the recent regulation allowing retail investors to engage in digital currencies on authorised exchanges, Hong Kong is attracting global firms with its lighter tax burden, Web3 development fund, seamless registration process, and free trade zones dedicated to incubating digital asset firms. Over 80 global firms are expected to set up shop in the city-state.

HKMA’s Chief Executive Eddie Yue said, “There is huge potential for collaboration between the Kingdom of Saudi Arabia and Hong Kong in areas spanning across economy and trade, sustainable development, finance, and FinTech. The MoU, in particular, will further enhance mutual cooperation as well as exchange of information and expertise between the SAMA and the HKMA in financial innovation and FinTech.”

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Hong Kong Saudi Arabia Asia FinTech