Chief Executive John Lee has said he's looking forward to building stronger ties between Hong Kong and Saudi Arabia, as officials launched negotiations in Riyadh on an agreement to promote investment between the two territories.

At the end of the first full day his visit to Saudi Arabia, the SAR leader said the two governments were discussing a number of collaboration agreements, covering investment promotion and protection, as well as legal and cultural exchange.

Lee spoke at an investment forum hosted by the Trade Development Council in Riyadh on Sunday evening local time.

"I am pleased to inform you that the two governments have agreed the formal negotiation on a bilateral investment promotion and protection agreement between Hong Kong and Saudi Arabia will commence," he said. "The agreement will further promote bilateral investment flows and strengthen confidence of investors from both sides."

He added: "We're also working to begin negotiations on an MOU promoting direct investment cooperation that can only fast track our business and investment collaboration."

Companies and organisations – including chambers of commerce – from both sides then exchanged memorandums of understanding, paving the way for further collaboration.

Saudi investment minister Khalid Al-Falih, who also attended the forum, said there are several areas in which Hong Kong and Saudi can work together, including financial services.

"There are tremendous opportunities for the Hong Kong financial industry to play in our growth journey, which is already in full speed... whether in asset management, private equity, banking, wealth management, insurance, or in fintech," he said.

Riyadh Alzamil, the chairman of Raz Group in Riyadh, said he also is interested in investing in sectors such as fintech and logistics in Hong Kong.

"It's not just investing in Hong Kong," he said. "For us as businessmen, we always want to import technology, link businesses together, and to invest in sectors and companies that we believe can come to Saudi Arabia and leverage the opportunities and potential here."

He added that the SAR would also be an attractive destination for extremely wealthy Saudi families to set up offices for wealth management in Asia, as they would then be able to tap into the huge potential the mainland market offers.

Earlier in the day, the CE met the deputy governor of Saudi's sovereign wealth fund, Public Investment Fund.

He wrote on social media that he had invited Turqi Al-Nowaiser to come to Hong Kong, so that he can "fully appreciate the vast opportunities available in the city".

Lee also went to an exhibition hall showcasing design plans for a futuristic Saudi city called "The Line".