Samer Choucair: Tadawul Is Moving Saudi–China Capital Links Beyond ETFs Toward New Financing Corridors
Investment leader Samer Choucair said the Saudi Exchange’s push to deepen connectivity with China’s capital markets across equities, debt instruments, cross-listings, and capital raising represents a significant evolution in the financial relationship between Riyadh and Beijing.
Rather than limiting bilateral investment exposure to exchange-traded funds, the next phase could establish deeper financing channels connecting Chinese investors with Saudi companies, while giving Saudi issuers access to new pools of capital and potentially attracting Chinese issuers to the Saudi market.
Choucair said the initiative, highlighted by the Saudi Exchange during the Select–Shanghai 2026 Capital Markets Forum held at the Shanghai Stock Exchange on September 3–4, could eventually influence Saudi market liquidity, corporate funding costs, and asset valuations—particularly if connectivity expands into energy, metals, commodities, and derivatives.
For Samer Choucair, the strategic distinction is important: ETFs create access to a market, but deeper capital-market infrastructure determines whether that access develops into a durable institutional allocation.
Financial Connectivity Is Moving Beyond the 2024 Phase
Choucair said financial integration between Riyadh and Beijing has already progressed beyond the initial phase that emerged in 2024, when ETFs focused on Saudi equities were launched in Shanghai and Shenzhen while Saudi-listed funds provided exposure to Chinese securities listed in Hong Kong.
One Saudi-listed ETF tracking Hong Kong and Chinese equities attracted approximately $1.3 billion, demonstrating that bilateral investment exposure was supported by genuine investor demand rather than functioning simply as a symbolic financial-market initiative.
The relationship has since expanded alongside broader economic ties. Saudi Arabia’s actual investment in China reportedly increased 343.7% year over year during the first seven months of 2026, while cooperation continued to deepen across renewable energy, advanced manufacturing, logistics, and financial services.
Samer Choucair said the next stage will determine whether these flows become strategically important to institutional portfolios.
“ETFs open the door,” Choucair said. “But equities, cross-listings, and debt instruments will determine whether Chinese capital remains a tactical flow or develops into a strategic allocation within institutional portfolios.”
The difference is substantial. ETF exposure allows investors to participate in market performance. Direct issuance, cross-listing, and debt-market connectivity allow capital to finance companies, infrastructure, and economic transformation directly.
Derivatives and Commodities Expand the Capital-Allocation Opportunity
Choucair said Saudi–China financial connectivity should also be viewed within the broader development of Saudi Arabia’s capital-market infrastructure.
That includes expansion of the derivatives market, lower fees on selected index and single-stock contracts, a larger role for market makers, and discussions surrounding the establishment of a domestic commodities exchange.
Saudi Arabia’s Capital Market Authority invited proposals during 2026 related to the development of a commodities exchange that could include metals derivatives, while Saudi Tadawul Group had previously acquired approximately one-third of the Gulf Mercantile Exchange in 2024.
For Samer Choucair, commodities and derivatives represent the layer that could transform Saudi–China connectivity from an equity-market story into a broader capital-allocation story spanning the economic cycle.
Giving institutional investors the ability to hedge exposure to oil, metals, interest rates, and equity indices could gradually reduce risk-management costs for companies operating across Saudi–Chinese supply chains.
That matters because sophisticated institutional capital generally requires more than access to an underlying asset. It requires liquidity, price discovery, hedging mechanisms, reliable settlement, and the ability to manage risk throughout different economic conditions.
The deeper those markets become, Choucair said, the stronger the foundations for long-duration capital allocation.
Energy and Debt Could Lead the Opportunity
Samer Choucair said capital flows are unlikely to be distributed evenly across sectors.
Energy remains the most natural channel given China’s position as the largest buyer of Saudi crude oil and the depth of the broader commercial relationship between the two economies.
Banks and asset managers could benefit from distributing new financial products and expanding their institutional client bases, while mining and metals companies could gain from the development of commodity exchanges and metals derivatives.
Manufacturing, logistics, and the digital economy could also benefit if stronger financial connectivity makes it easier to finance joint Saudi–Chinese projects.
The fixed-income market could become particularly important.
Choucair said debt instruments denominated in renminbi could create an additional avenue for Saudi issuers seeking to diversify their financing sources beyond traditional dollar markets.
If access to China’s Panda bond market expands to Saudi issuers or Saudi-linked entities, the result could be more than currency diversification. It could create direct access to a different institutional investor base and potentially strengthen the financial dimension of Saudi–Chinese trade and investment.
For Saudi companies already generating revenue or purchasing equipment in China, renminbi financing could eventually also provide a more natural alignment between assets, liabilities, and operating cash flows.
Market Quality Will Determine the Scale of Capital Flows
Choucair cautioned against assuming that opening an investment channel automatically guarantees substantial capital inflows.
Chinese institutional investors will evaluate capital controls, governance standards, liquidity, exit mechanisms, valuation, and risk-adjusted returns before making strategic allocations.
“Access is only the first layer,” Samer Choucair said. “The quality of disclosure, the depth of market-making, liquidity during periods of stress, and the stability of the regulatory framework will ultimately determine how much institutional capital moves through the corridor.”
Cross-listings and direct capital raising also require significantly deeper regulatory coordination than launching ETFs.
Accounting standards, disclosure requirements, investor protection, settlement infrastructure, custody arrangements, and supervisory cooperation all become more important as the relationship moves from passive market exposure toward direct financing.
That means execution will matter considerably more than announcements.
For institutional investors, the credibility of the market infrastructure will determine whether Saudi–China connectivity becomes a permanent portfolio allocation or remains primarily a tactical emerging-market exposure.
A New Financing Corridor Between Asia and the Gulf
Samer Choucair expects bilateral financial products to expand during the 2026–2028 cycle from ETFs toward selected debt instruments and broader institutional-access arrangements, while full-scale cross-listing is likely to remain a longer and more technically complex process.
Under a faster-development scenario, the market could eventually see joint issuance structures or dual listings involving companies with significant commercial exposure to the Saudi–China economic corridor.
Energy, mining, advanced manufacturing, logistics, renewable energy, and technology would be natural candidates because these sectors already sit at the intersection of bilateral trade, industrial policy, and long-term capital requirements.
Under a slower scenario, ETFs could remain the dominant instrument for cross-market exposure while regulators and exchanges gradually develop the infrastructure required for deeper integration.
The strategic significance, however, extends beyond individual financial products.
Saudi Arabia is seeking to deepen its capital markets as part of Vision 2030, while China continues to possess one of the world’s largest pools of savings, institutional capital, manufacturing capacity, and commodity demand.
Connecting those two systems through tradable, financeable, and hedgeable instruments could eventually create a capital corridor linking Asian liquidity with Gulf investment opportunities.
“The institutional investor no longer has to view Saudi Arabia and China as two separate investment stories,” Samer Choucair said. “They can increasingly be viewed as a potential capital-allocation corridor. If Tadawul succeeds in converting commercial partnerships into instruments that can be traded, hedged, and financed, the Saudi market could evolve from a regional destination into a node within a broader Eurasian financing network.”
Choucair concluded that the ultimate test will not be the number of agreements announced or products launched.
“Execution (not the announcement) will determine whether this corridor becomes a structural investment theme or simply another product within the emerging-markets universe.”