Hong KongCNN —  For the first time, Hong Kong’s leader has welcomed Saudi Arabian elites to the city for an investment conference, in an example of how it is embracing new potential business partners as it confronts a slumping economy and geopolitical uncertainty.

In opening remarks on Thursday, Hong Kong Chief Executive John Lee called the gathering “yet another significant step forward, in the deepening [of] ties between Hong Kong and the Middle East, particularly the Kingdom of Saudi Arabia.”

The two-day event was organized by the Hong Kong government, its stock exchange and the Future Investment Initiative (FII) Institute — a nonprofit founded by the Public Investment Fund (PIF), Saudi Arabia’s sovereign wealth fund. The institute hosts an annual event in Riyadh dubbed “Davos in the Desert.”

PIF Governor and FII Institute Chairman Yasir Al-Rumayyan said onstage Thursday that the institute was looking to expand in Asia. It opened a Hong Kong office in 2020, and “hopefully, very soon we will open up in China and India,” he added.

Al-Rumayyan said Hong Kong was selected as a partner for the latest FII event in part because of the city’s role as a major financial hub and proximity to mainland China.

Hong Kong has aggressively courted Saudi Arabia for more business this year as it works to hedge against US-China tensions, which have led to the greater risk of Western companies reducing their operations in the semi-autonomous Chinese city, said Willy Lam, senior China fellow of the Jamestown Foundation, a US think tank.

He called the summit “a shot in the arm” for Hong Kong’s economy, which he says has suffered from an exodus of foreign talent, decline in property prices and drop in the number of foreign companies using the city as a regional base in recent years.

“Saudi Arabia could be a big prize for Hong Kong,” given the size of its economy and trusted allyship with China, according to Lam. Last year, the two countries signed a strategic partnership agreement.

George Chan, a Shanghai-based global IPO leader for EY, also said the summit was a way for Hong Kong to advance its goal of “diversifying” its economic partnerships amid complex global challenges.

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