Singapore, China deepen collaboration in digital finance, among other areas: MAS

To support tourism, trade and e-commerce between Singapore and China, the MAS is working with the People's Bank of China.
To support tourism, trade and e-commerce between Singapore and China, the MAS is working with the People's Bank of China.PHOTO: REUTERS

SINGAPORE - To support tourism, trade and e-commerce between Singapore and China, the Monetary Authority of Singapore (MAS) is working with the People's Bank of China in the area of digital finance, the central bank said on Tuesday (Dec 8).

This is one in a slew of initiatives that will deepen financial cooperation between Singapore and China following an apex meeting between the two countries, the MAS said.

It added that the measures will build on existing areas of collaboration, with the aim of supporting financing and investment activities to help Singapore and China recover from the Covid-19 pandemic.

The initiatives were discussed at the 16th Joint Council for Bilateral Cooperation between Singapore and China, the highest-level bilateral platform between the two countries, on Tuesday (Dec 8), the MAS said.

Another initiative is a 25 billion yuan ($5.11 billion) facility launched last month to help banks in Singapore meet their customers' growing business needs in Singapore and the region.

Yuan funding of up to three months will be channelled to primary dealers - banks in Singapore approved by the MAS - through the authority's money market operations.

These funds will strengthen their credit intermediation capabilities and the overall yuan market liquidity in Singapore, MAS said in a statement when it announced the facility's launch.

The central bank and the China Securities Regulatory Commission are also facilitating efforts by Singapore and Chinese exchanges to collaborate in new areas such as exchange-traded funds, the MAS said on Tuesday. It added that it will also work with Chinese central and provincial counterparts to broaden cooperation in green finance.

MAS also said that it has awarded China Construction Bank a qualifying full bank licence (QFB) that will allow the bank greater operational privileges offering a full suite of banking products that are permitted under the Banking Act.

The award comes under the China-Singapore Free Trade Agreement Upgrade Protocol that kicked in last year.

Currently, only 10 foreign banks, including Bank of China, HSBC and Citi, hold QFB status in Singapore. Chinese banks hold the most number of QFB licences here.

A China Construction Bank statement on Tuesday said that "with the award of the QFB licence, the branch will be focusing its efforts in establishing a commodity trade financing centre, investment banking transaction centre and fintech innovation centre in Singapore".

"Concurrent with the existing infrastructure financing service centre and private banking centre, these will be the main driving forces in the future growth of the branch," it added.