Singapore can continue to play catalytic role in promoting yuan use: Heng Swee Keat

An employee counting yuan banknotes at a branch of Bank of China in Taiyuan, Shanxi.
An employee counting yuan banknotes at a branch of Bank of China in Taiyuan, Shanxi.PHOTO: REUTERS

SINGAPORE - Singapore can continue to play a catalytic role to promote the use of the yuan in South-east Asia and beyond.

Its vibrant banking sector and capital markets, as well as strong asset and wealth management capabilities, have allowed it to support the internationalisation of the yuan, said Finance Minister Heng Swee Keat on Friday (Nov 6).

Singapore is the largest offshore yuan centre outside Greater China, and offers a wide range of yuan-denominated products.

There is also strong interest by banks and businesses to tap yuan funding in Singapore's capital markets.

On the investment front, Singapore has used nearly 60 per cent of its quota to invest in China's financial markets, with further strong interest in the pipeline, he said.

"Our banks are well-positioned to help Chinese entities navigate their expansion in South-east Asia, given their deep knowledge of the region honed through an extensive network and years of operation," Mr Heng added.

He was speaking at the China and Singapore Commodity and RMB Summit held at Mandarin Orchard Hotel.

Organised by the Bank of China and IE Singapore, the event also saw the launch of several new initiatives.

The Bank of China launched two global commodity business centres, making it the first Chinese bank to establish such centres outside China.

The global energy commodity business centre and global commodity repo centre will allow the bank to provide commodity companies increased liquidity.

Mr Heng welcomed the establishment of these two centres, saying that they will add to the vibrancy and depth of the commodities trading and financing landscape in Singapore.

Other than the two centres, the Bank of China also signed a memorandum of understanding with IE Singapore to cooperate in helping Singapore and Chinese companies expand internationally.

In addition, the two organisations will work together to develop Singapore's commodity trading and financial sectors.

A cooperation agreement between the bank and the Singapore Exchange was also inked at the event.

Both parties will cooperate to give businesses access to more diversified yuan-denominated financial services and tools.

Some 400 industry players and government officials attended the event.