Hong Kong's Islamic New Year

By Heda Bayron
When Jawaher Al Sudairy began talking about the sands of Saudi Arabia, her audience listened attentively. At a recent luncheon meeting at the Hong Kong Chamber of Commerce, the China director of the Saudi Arabian General Investment Authority captivated Hong Kong business executives about the fortunes lying underneath the sands of the Kingdom. And she wasn't talking about oil. Al Sudairy was pitching mining opportunities in Saudi Arabia.

There's a hunger in Hong Kong to know more about the Middle East these days, fueled in part by the recent buzz created by the city's leader, Donald Tsang, that Hong Kong will open its doors to Islamic banking and finance, promising to create an Islamic bond market and to bring in more of the Middle East's petrodollars into the city.

The interest goes both ways. Middle Eastern financial institutions and companies have been investing in Hong Kong's rising stock market and property sector. HSBC's local unit, Hang Seng Bank, for instance, decided to introduce Hong Kong's first Islamic fund after being approached by a Middle East financial institution in 2006 to help manage its investments in Hong Kong and China. Last year, Dubai Investment Group, part of the government's Dubai Holdings, bought a roughly 10% stake in Sun Hung Kai Financial, one of the city's largest non-bank financial institutions and a unit of one of Hong Kong's biggest property developers.