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 yesterday.
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, yesterday, the MAS said.
Another initiative is a 25 billion yuan (S$5.1 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 overall yuan market liquidity in Singapore, the 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 yesterday. It will also deepen cooperation with China in green finance.
The MAS also said it has awarded China Construction Bank a qualifying full bank licence (QFB), which will allow the bank to have greater operational privileges here.
The award was "a direct manifestation" of the China-Singapore Free Trade Agreement Upgrade Protocol that kicked in last year, China Construction Bank said in a statement yesterday.
Previously, only 10 foreign banks - including Bank of China, HSBC and Citi - held QFB status in Singapore. Chinese banks now hold the most number of QFB licences here.
With the QFB licence, China Construction Bank said that it will focus on 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.