SHANGHAI, June 14 Reuters China approved its first exchangetraded funds ETFs investing in Saudi Arabia equities on Friday, fund managers told Reuters, as Beijing expands ties with the Middle East amid rising tensions with the West.

The products, managed by China39;s HuataiPinebridge Investments and Southern Asset Management separately, will track Hong Konglisted CSOP Saudi Arabia ETF, which debuted in November by Hong Kongbased CSOP Asset Management, according to the two fund managers.

The approval will further deepen the cooperation between Saudi and China in capital markets, said Ding Chen, chief executive officer at CSOP.

The CSOP Saudi Arabia ETF, which tracks the performance of the FTSE Saudi Arabia Index, is down roughly 5 so far this year, compared with a 3 gain in China39;s stock benchmark CSI 300.

Reuters reported in August that China and Saudi Arabia39;s stock exchanges were talking about allowing exchangetraded funds ETFs to list on each other39;s bourses, as the countries look to deepen financial ties amid warming diplomatic relations.

Through the ETF, investors in China will be able to trade Saudi stocks including the oil giant Saudi Aramco and Saudi National Bank.

Beijing, frustrated by what it sees as Washington39;s weaponisation of economic policies, has sought to expand ties with countries in Europe, the Middle East and Africa. Its diplomatic push to court others include U.S. ally Saudi Arabia.

Earlier this week, China39;s securities regulator…