Financial institutions from Singapore and Chongqing, China, signed 28 agreements in total yesterday, involving transactions valued at over US$1.6 billion (S$2.2 billion).
The deals marked the start of new collaboration among these financial institutions, as well as specific financing deals in bond issuances and cross-border loans, said Mr Ravi Menon, managing director of the Monetary Authority of Singapore.
He was speaking at the Singapore-China (Chongqing) Financial Conference in Chongqing.
As of last month, Singapore's financial sector has been involved in brokering close to US$4.5 billion in deals for Chongqing companies, he said. For example, Chongqing Grain issued its first yuan-denominated Lion City bond in Singapore. The issuance attracted overwhelming interest from offshore investors, with subscriptions of over nine times its issuance value, reflecting the strong latent demand for yuan offerings in Singapore, Mr Menon noted.
He said there has been a healthy volume of cross-border transactions between China and South-east Asia, through Singapore, since the launch of the Chongqing Connectivity Initiative (CCI) last November.
The Chongqing Connectivity Initiative ... demonstrates the strong ties and long history of co-operation between China and Singapore.
MR RAVI MENON, managing director of the Monetary Authority of Singapore.
The CCI is the third government-led project between China and Singapore, following the development of Suzhou Industrial Park in 1994 and Tianjin Eco-city in 2008.
Mr Menon said: "The Chongqing Connectivity Initiative... demonstrates the strong ties and long history of co-operation between China and Singapore.
"It underscores the transformation of the Chinese economy as innovation, technology and modern services become key drivers in the country's next phase of growth."
He added that the CCI has identified four priority areas for bilateral collaboration: finance, aviation, transport and logistics, and info-communications technology.
In the area of finance, in particular, he said that Singapore can support the CCI's objectives as it is an international financial centre, and "can offer the necessary breadth and depth of banking and capital market services to Chinese companies - from advice on regional markets to funding and capital management solutions".
Singapore is one of the top three offshore yuan centres globally, Mr Menon added. The yuan is also known as the renminbi, or RMB.
"The offshore RMB market in Singapore has expanded rapidly, with a wide offering of RMB products, including deposits, bonds, derivatives, mutual funds and trade financing. Singapore's financial centre has played a constructive role in supporting the internationalisation of the RMB," he said.
"This has, in turn, helped to forge stronger trade and investment links between China and South-east Asia. And recognising the international role of the RMB, Singapore has included the RMB in our official foreign reserves."