The Monetary Authority of Singapore (MAS) announced on Dec 8 that Singapore and China will be enhancing their financial partnership to support a post-Covid-19 recovery.
The partnership will build on existing areas of collaboration and facilitate financing and investment activities between both countries.
The initiatives were discussed at the 16th Joint Council for Bilateral Cooperation (JCBC) between Singapore and China co-chaired by Singapore’s Deputy Prime Minister, Coordinating Minister for Economic Policies and Minister for Finance Heng Swee Keat and China’s Executive Vice Premier of the State Council Han Zheng.
The initiatives include cooperation between the Singapore and Chinese exchanges to collaborate in new areas such as exchange traded funds (ETFs).
MAS and the People’s Bank of China are exploring cooperating in the area of digital finance to support tourism, trade and e-commerce between both countries.
MAS will also work with its Chinese central and provincial counterparts to broaden cooperation in green finance.
SEE:MAS awards digital bank licences to two consortiums, two entities
In addition, the initiatives will include RMB cooperation to better meet the RMB financing and hedging needs of corporates in Singapore and the region.
MAS announced the award of a qualifying full bank (QFB) licence to China Construction Bank under the China-Singapore Free Trade Agreement Upgrade Protocol.
The Singapore central bank has also identified the Zhengzhou Commodity Exchange as a recognised market operator to allow investors in Singapore access to the commodity derivatives markets in China.
These announcements come on the back of the China Securities Regulatory Commission (CSRC)’s approval in August this year for the establishment of DBS Securities (China) Limited, providing customers in China greater access to international capabilities and offerings.
“Financial services will play a critical role in facilitating a post-Covid-19 economic recovery. At the same time, RMB internationalisation and the further opening up of China’s capital markets are two key trends shaping Asia’s financial services landscape over the medium term,” says Jacqueline Loh, deputy managing director at MAS.
“Singapore can play a useful role in this transformation, while supporting bilateral growth, and trade and investments between China and Singapore,” Loh adds.
