Why Hong Kong matters to Kazakhstan’s financial ambitions

As part of its decades-old “multi-vector” foreign policy, based on balancing relations between major powers such as China, Russia, the United States and the European Union, Kazakhstan – Central Asia’s largest country – is now actively diversifying its economic and financial policies. While in the past, Astana sought to strengthen cooperation with the United Arab Emirates (UAE), the leading international financial hub in the Middle East, today, Hong Kong seems to be becoming a key partner for investment.

That, however, does not mean the Central Asian state aims to give up its partnership with Abu Dhabi. After the US and Israel attacked Iran on February 28, prompting Tehran’s retaliation which affected neighbouring states including the UAE, Kazakh President Kassym-Jomart Tokayev called the oil-rich country’s leader, Sheikh Khaled bin Mohamed bin Zayed Al Nahyan, to express support and solidarity. This made it clear that Kazakhstan would continue to see the UAE as its key partner in the Middle East.

Indeed, despite the conflict in the Gulf region and blockade of the Strait of Hormuz, the Kazakh-UAE relationship continues to grow and Astana seeks to expand ties with UAE financial institutions. At the same time, Kazakhstan aims to develop its relations with other regional financial hubs.

It was, therefore, no surprise that on June 3, Tokayev met Cypriot President Nikos Christodoulides to explore opportunities for closer ties with the island, a leading European financial services hub in sectors such as fintech and maritime logistics.

Coincidentally or not, John Lee Ka-chiu, chief executive of Hong Kong – another global financial hub – visited Astana around the same time, underscoring Kazakhstan’s efforts to diversify its financial partnerships. The Hong Kong business delegation signed at least 43 memorandums of understanding and cooperation agreements in various fields – from media to finance and agriculture.

“I believe that Kazakhstan can serve as a hub for Hong Kong to connect with the Central Asian market. In turn, Hong Kong can be Central Asia’s hub in the East and Southeast Asian region,” Lee said after his talks with Kazakh leaders, including President Tokayev, Prime Minister Olzhas Bektenov and Deputy Prime Minister and Minister of National Economy Serik Zhumangarin.