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Lujiazui Financial City Authority Establishes Office in Riyadh as Regional Investment Gateway

Lujiazui Financial City Authority in Shanghai, China, receives the office data plate in Riyadh (Asharq Al-Awsat)
Lujiazui Financial City Authority in Shanghai, China, receives the office data plate in Riyadh (Asharq Al-Awsat)
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Lujiazui Financial City Authority Establishes Office in Riyadh as Regional Investment Gateway

Lujiazui Financial City Authority in Shanghai, China, receives the office data plate in Riyadh (Asharq Al-Awsat)
Lujiazui Financial City Authority in Shanghai, China, receives the office data plate in Riyadh (Asharq Al-Awsat)

China's Shanghai Lujiazui Financial City Authority (SLFCA) has opened its representative office in Riyadh as a commercial investment gateway to access the Middle East markets.

Lujiazui Finance and Trade Zone is the only national-level development zone in China that focuses on the finance and trade industries.

China (Shanghai) Pilot Free Trade Zone and the city's top attraction for entrepreneurs, talent, and investors are in Pudong New Area, where Lujiazui is located.

A high-ranking delegation from the Lujiazui Financial City Authority in Shanghai visited the King Abdullah Financial District (KAFD) and announced the establishment of the first office in the Middle East and the second in the world after the London office in 2016.

eWTP Arabia Capital, a venture capital investment firm based in Riyadh City with a branch office in Beijing, organized the event.

- Modern techniques

During the event, eWTPA signed a strategic agreement with the Lujiazui Financial City Authority to stimulate comprehensive cooperation in commercial, money, and talent interactions between China and Saudi Arabia by synchronizing connectivity across various sectors, including banking, trade, innovation, and technology.

A Memorandum of Understanding (MoU) was also signed by eWTPA, SLFCA, and KAFD District Management and Development Company (KAFD DMC) to improve partnerships between Shanghai and Riyadh, the two countries' principal financial centers, and open new horizons for strategic cooperation.

With the support of eWTPA, the Riyadh office of the Lujiazui Financial City Authority will become the main gateway connecting Shanghai to the Kingdom.

The office will become an official platform linking all stakeholders in the markets of the two countries and strengthening partnership relations in trade, modern technologies, finance, and other sectors.

- Stimulating the private sector

KAFD DMC CEO Gautam Sashittal stressed the importance of cooperation between the Kingdom and China, pointing out that effective partnership models are incentives that enhance business and pave the way for companies to grow and benefit from new markets.

"This strategic agreement will pave the way for meaningful engagement in the days ahead and ensure smooth working relationships for individuals and businesses," Sashittal added.

For his part, founder and managing partner of eWTPA Jerry Li told Asharq Al-Awsat that the Kingdom will be the first stop to expand the Lujiazui Financial City Authority in the Middle East.

The Authority chose Riyadh as the first stop to launch into the regional region in light of the rapidly developing Saudi-Chinese economic relations, said Li.

- Double the business turnover

Li continued that opening the office in Riyadh helps double the trade movement between the two countries and accelerates the pace of private investments.

Li added that the partnership is essential to Riyadh and Shanghai and has promising potential to generate significant value.

He revealed Shanghai's desire to harness its expertise to support the Kingdom in achieving Vision 2030 and that SLFCA's office is an entry point that allows in-depth knowledge of and benefits from the thriving Chinese sectors, such as trade, modern technologies, and money.

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What Does the Inclusion of Saudi Bonds in the J.P. Morgan Index Mean?

Saudi woman walks at the Saudi stock market in Riyadh - Reuters
Saudi woman walks at the Saudi stock market in Riyadh - Reuters
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What Does the Inclusion of Saudi Bonds in the J.P. Morgan Index Mean?

Saudi woman walks at the Saudi stock market in Riyadh - Reuters
Saudi woman walks at the Saudi stock market in Riyadh - Reuters

Saudi Arabia’s debt market is set for a strategic shift in early 2027, following J.P. Morgan’s announcement that local-currency bonds will be included in its global emerging markets bond index. The move represents a vote of confidence in the Kingdom’s structural reforms and is expected to open the door to substantial capital inflows that will help finance major economic transformation projects.

In a note, J.P. Morgan said the move follows a series of reforms to improve foreign investor access and enhance local market capabilities.

The bank added that Saudi sukuk, Shariah-compliant debt instruments that function similarly to bonds, with a remaining maturity of up to 15 years, will be eligible for inclusion in the Government Bond Index-Emerging Markets (GBI-EM), the most widely tracked benchmark of its kind, with $233 billion in assets tracking it.

J.P. Morgan said eight sukuk issues would be eligible for inclusion, with a total value of $69 billion.

The Kingdom’s inclusion in the index is expected to boost liquidity and demand for sovereign debt, contributing to lower borrowing costs.

In September, J.P. Morgan had placed Saudi Arabia on “Positive Index Watch,” paving the way for its eventual inclusion in the GBI-EM.

Commenting on the decision, Saudi Finance Minister Mohammed Al-Jadaan told Bloomberg that the move reflects continued confidence in the Kingdom’s economic transformation trajectory. He said the inclusion marks a new milestone in Saudi Arabia’s integration into global financial markets, adding that its immediate impact will be seen in broadening and diversifying the investor base and supporting long-term capital inflows into the domestic debt market, thereby strengthening the resilience and stability of the national economy.

The Significance of the Index

The importance of J.P. Morgan’s index lies in its role as a benchmark guiding major global fund allocations, particularly passive funds that track indices automatically. With an expected weighting of around 2.52 percent, Saudi bonds will become a core component of international investor portfolios, increasing government bond liquidity and reducing borrowing costs over the long term, a critical factor for the Kingdom’s economy.

Passive funds play a key role in ensuring steady inflows. Trillions of dollars globally are managed through such funds. Once Saudi Arabia is included in the index, these funds will purchase Saudi bonds to remain aligned with it. Unlike active investors, they do not rapidly buy or sell based on daily news or market sentiment, but continue to hold bonds as long as they remain in the index, providing significant stability to the Saudi debt market. Their participation also ensures a constant base of large-scale buyers, facilitating bond trading at any time.

Reforms That Paved the Way

This inclusion is the result of a series of regulatory reforms highlighted by the bank in its note. Saudi Arabia has improved international investor access by linking to the global Euroclear system, expanding its network of primary dealers to include international banks, and facilitating cross-border settlement and trading. These measures have enhanced legal certainty and transparency, making the Saudi debt market an attractive and secure destination for foreign capital.

Financial Stability Amid Regional Challenges

Beyond its economic dimensions, the move carries strategic significance amid ongoing geopolitical tensions in the region. Increased inflows into local bonds are expected to strengthen the government’s ability to manage any economic fallout from regional instability. It underscores the resilience and attractiveness of the Saudi economy, demonstrating its capacity to attract quality investment and secure the financing needed for its development plans regardless of external challenges.

Business

S&P Warns African Sovereign Credit Rating Risks Likely to Worsen

Central Bank of Egypt building (A.P.)
Central Bank of Egypt building (A.P.)
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S&P Warns African Sovereign Credit Rating Risks Likely to Worsen

Central Bank of Egypt building (A.P.)
Central Bank of Egypt building (A.P.)

S&P Global Ratings warned on Thursday that the risks to African sovereign credit scores were likely to worsen the longer the Middle East war drags on.

The ratings agency said that higher fuel and fertilizer import costs would increase inflation and fiscal strains for countries, "potentially leading to rating pressure".

Egypt, Mozambique and Rwanda are among the "most exposed" the agency said, although Egypt's deep domestic capital markets and Rwanda's high levels of concessional debt provide some offset, according to Reuters.

Less exposed are net-oil exporters Nigeria, Angola and Congo-Brazzaville as well as Morocco, due to stronger foreign-currency reserves.

S&P's "base case" assumed that the conflict will peak and that the Strait of Hormuz will gradually reopen but related disruptions will likely persist for months. A resumption of hostilities and a more prolonged conflict would present a greater threat to many African sovereigns.

The ratings agency said it expected Africa's borrowing costs to increase due to war's impacts and as a result of global risk aversion.

S&P in recent weeks kept Egypt's credit rating on a "stable" outlook and affirmed ratings for Morocco, Ghana and Mozambique.

Business

Gold Slips on Inflation Concerns as High Oil Prices and Stronger Dollar Weigh

An image made with a drone shows oil gas and fuel storage units at the Navigator Terminal in Grays, Britain, 14 April 2026. EPA/NEIL HALL
An image made with a drone shows oil gas and fuel storage units at the Navigator Terminal in Grays, Britain, 14 April 2026. EPA/NEIL HALL
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Gold Slips on Inflation Concerns as High Oil Prices and Stronger Dollar Weigh

An image made with a drone shows oil gas and fuel storage units at the Navigator Terminal in Grays, Britain, 14 April 2026. EPA/NEIL HALL
An image made with a drone shows oil gas and fuel storage units at the Navigator Terminal in Grays, Britain, 14 April 2026. EPA/NEIL HALL

Gold prices fell on Thursday, pressured by a stronger dollar and elevated oil prices that stoked inflation worries, as investors tried to assess the conflict direction from stalled US-Iran talks.

Spot gold was down 0.9% at $4,696.71 per ounce, as of 1135 GMT. US gold futures for June delivery fell 0.8% to $4,714.0.

The dollar inched higher, making greenback-priced bullion more expensive for holders of other currencies, while benchmark 10-year US Treasury yields rose to an over one-week high, raising the opportunity cost of holding non-yielding bullion.

"Gold continues to take its cues from the oil market, with rising energy costs keeping the risk of near-term dollar strength and elevated inflation in focus," said Ole Hansen, head of commodity strategy at Saxo Bank.

Iran seized two ships in the Strait of Hormuz as it tightened its grip on the strategic waterway after US President Donald Trump announced he was indefinitely calling off attacks, with no sign of peace talks restarting.

Iranian officials did not say they had agreed to any extension of the truce, accusing Washington of violating it by maintaining a blockade on Iranian trade by sea.

Brent crude oil prices rose above $100 a barrel on the stalled peace talks and as both nations maintained their restrictions on the flow of trade through the strait.

Higher crude oil prices can add to inflationary pressures, increasing the likelihood that interest rates remain elevated. While gold is often seen as an inflation hedge, higher rates dampen bullion’s appeal as it offers no yield.

Meanwhile, a Reuters poll of economists showed the US Federal Reserve will likely wait at least six months before cutting interest rates this year as war-driven energy shocks reignite already-elevated inflation.

"The current consolidation appears more a pause driven by rate uncertainty than a structural shift, and we maintain the view that gold is likely to reach a fresh record high later this year or in early 2027," Hansen added.

Spot silver fell 3.9% to $74.63 per ounce, while platinum lost 3.2% to $2,007.98, a more than one-week low for both metals. Palladium was down 4.8% at $1,470.79, a more than two-week low.