Hong Kong’s burgeoning startups and investment entities perceived the Leap technology conference held in Riyadh from Monday to Wednesday as a prime occasion for establishing a foothold in the Saudi Arabian market. This territory is currently experiencing significant investment as it strives to rival the United Arab Emirates (UAE) in becoming the leading force in the regional market.
The Saudi Arabian government-sponsored event has garnered attention from various company sizes due to its market being viewed as a nascent yet fast-growing economy. This is in contrast to the UAE’s market, which is considered more mature, particularly Dubai’s prominent role in technology investments.
I always give the sort of rough comparison of Saudi [Arabia] as more like China in the late 90s, early 2000s, with UAE or Dubai more like Hong Kong: sexy, bright lights, tourists and so on,
remarked Patrick Tsang, the founder of Tsangs Group family office based in Hong Kong. But [the UAE] is a much smaller place, much less population and fewer projects than you can invest into.
While the UAE’s market maturity makes it challenging to establish new business relationships, Saudi Arabia is just beyond its nascent stage, presenting a ‘golden period’ for the next 10-15 years, both for the country and investors.
The Leap 2024 conference also showcased a pavilion exclusively for Hong Kong startups for the first time. Participants noted the potential of the Saudi market as their main interest, rather than immediate material gains.
We didn’t have many expectations [for Saudi Arabia]… It’s definitely exploratory for us,
said Pete Laverick, senior project manager at tech education firm Preface and head of business development for its Web3 affiliate Prolog. Despite this exploratory phase, there is a clear interest in tapping into the Saudi market and establishing key business connections.
While Dubai might be a more logical choice for a regional headquarters due to its status as a global Web3 hub, Saudi Arabia’s burgeoning ties with China and its integral role in the Belt and Road Initiative could offer unique advantages to certain companies.
Cornerstone Robotics, a venture from Hong Kong Science and Technology Park, is on the verge of receiving regulatory approval in mainland China and is exploring opportunities in the Middle East. Saudi Arabia, with its dynamic economic transformation, is an attractive prospect for funding and partnerships.
Despite being the largest economy in the Middle East, Saudi Arabia trails behind its neighbors in gross domestic product (GDP) per capita and foreign direct investment (FDI). For instance, in 2022, the UAE received US$22.7 billion in FDI, while Saudi Arabia attracted US$7.9 billion. The GDP per capita for the UAE was US$53,708 compared to Saudi Arabia’s US$30,448.
Logistical challenges at the conference, such as the new convention center’s remote location, underscored the market’s developmental hurdles. However, this did not deter major tech corporations like Huawei Technologies, DJI, Tencent Holdings, Alibaba Group Holding, Google, Amazon.com, and Microsoft from participating and showcasing their offerings alongside one another.
In contrast to CES in Las Vegas, where some Chinese firms face restrictions, the Leap conference allowed these companies to stand on equal footing with their Silicon Valley counterparts. This is particularly significant as global markets become more challenging for Chinese tech giants due to political tensions. As a result, the Saudi Arabian market is becoming increasingly attractive as one of the few rapidly growing markets where Chinese firms can compete freely.