Singapore and China expand financial cooperation

Thursday 7 December 2023 14:44 CET | News

The Monetary Authority of Singapore (MAS) has announced additional digital finance and capital markets proposals to expand its financial cooperation with China.  

As per the information detailed in the press release, the proposals were discussed at the Joint Council for Bilateral Cooperation (JCBC) in Tianjin, being co-chaired by officials from both Singapore and China.

The Monetary Authority of Singapore (MAS) has announced additional digital finance and capital markets proposals to expand its financial cooperation with China.

MAS proposed the following initiatives to enhance its digital finance and capital markets cooperation with China:
  • Implementation of a cross-border e-CNY pilot between China and Singapore, with the proposal being preceded by a Memorandum of Understanding (MoU) from 2020 between MAS and the Digital Currency Institute and People’s Bank of China (PBCDCI). This allowed MAS and PBCDCI to develop a pilot that intends to enable travellers from both countries to leverage e-CNY for tourism spending, improving convenience when making purchases during overseas visits;

  • Introduction of the Exchange Traded Funds (ETF) Product Link between the Singapore Exchange (SGX) and Shanghai Stock Exchange (SSE), with the initiative being based on the successful launch of the ETF Product Link between SGX and Shenzhen Stock Exchange (SZSE) at the previous JCBC in 2022. In May 2023, SGX and SSE signed an MoU to develop an ETF Product Link, and, in December 2023, CSOP Huatai-Pinebridge SSE Dividend Index ETF and the CSOP iEdge Southeast Asia+ TECH Index ETF were launched on SGX and SSE as the first product pairing under the new ETF Product Link. Through this successful launch, fund managers in both markets received improved collaboration opportunities, while also enhancing investors’ access to ETF products in each other’s markets;

  • The signing of a MoU between SGX and Guangzhou Futures Exchange (GFEX) to collaborate on information exchange, mutual visits and training, and joint research on solutions and business areas related to green development.

Furthermore, local banks from Singapore and China’s UnionPay International also boarded early-stage feasibility discussions on possible remittance linkage between PayNow and UnionPay compatible with each jurisdiction’s laws and regulations. The linkage could provide secure, convenient, and cost-effective cross-border payments and remittances between the two regions. China and Singapore are also working on key initiatives, including a green corridor for green and transition financing products, and capacity building, following the establishment of the China-Singapore Green Finance Task Force (GFTF) on the 2022 JCBC.

According to MAS’ officials, considering that 2023 was a prosperous year of financial cooperation between the two countries, the regulatory body introduced new initiatives in digital finance and capital markets connectivity intending to launch additional financial flows between China and Singapore’s financial centres. Also, MAS aims to enhance trade and economic relations between the two economies.

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Keywords: online banking, green finance, trade finance, digital banking, remittances
Categories: Banking & Fintech
Companies: Monetary Authority of Singapore
Countries: China, Singapore
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Banking & Fintech

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