The Monetary Authority of Singapore (MAS) today announced new green finance and capital markets initiatives to strengthen financial cooperation with China. The initiatives were announced at the 20th Joint Council for Bilateral Cooperation (JCBC) meeting in Singapore, which was co-chaired by Singapore Deputy Prime Minister, Mr Gan Kim Yong, and People’s Republic of China Vice Premier of the State Council, Mr Ding Xuexiang.
2. The initiatives include:
- Catalysing Green Financing Flows. The China-Singapore Green Finance Taskforce (GFTF), established by MAS and the People’s Bank of China (PBC) in 2023, has been working to expand the Common Ground Taxonomy (CGT) under the International Platform on Sustainable Finance’s (IPSF) to include the Singapore-Asia Taxonomy. The exercise, which compares the green criteria of the European Union, China and Singapore taxonomies, will be completed by the end of this year. This will enable easier comparison of the green taxonomies of Singapore and China and facilitate the provision of cross-border green loans, green bond issuance and fund investments. In this regard, industry partners from both countries have been collaborating on Panda Bond issuances
[1] through a Green Corridor, to further catalyse green financing flows between Singapore and China. - Explore Piloting the “Over-the-Counter” Bond Market Framework between China and Singapore. MAS and the PBC are exploring a pilot with Singapore and Chinese banks to enhance international investors’ access to China’s bond market. The pilot will leverage the existing “over-the-counter” bond market framework in China, to enable participating banks in Singapore to provide trading and custody services for selected fixed income products for the China Interbank Bond Market.
- Strengthening Collaboration in Indices and Exchange Traded Funds (ETF) Product Links. Building on the good progress and strong investor interest in the ETF Product Links between the Singapore Exchange (SGX) and the Shenzhen and Shanghai Stock Exchanges
[2] , MAS and the China Securities Regulatory Commission (CSRC) are also in discussions to expand the suite of products on the ETF Product Links. In addition, SGX and China Securities Index are in discussions to develop a second index after the successful launch of their Emerging Asia Technology Index in January 2024. These collaborations will enrich the regional capital markets ecosystem with new ETF products and indices to cater to the evolving needs of investors. - Facilitating Financial Institutions’ Access to Chinese Markets. Singapore and China continue to work in collaboration to facilitate the growing interest of financial institutions based in Singapore and China to expand in each other’s markets:
- First Listing of Panda Bond in Singapore. MAS and PBC welcome the first Panda Bond to list on the Singapore Exchange - UOB’s three-year, RMB 5 billion Panda Bond
[3] . The listing of Panda Bonds in Singapore will foster greater interest and participation by international investors and issuers in the Panda Bond market.
- Memorandum of Understanding (MoU) between UOB and the Shanghai Gold Exchange (SGE). UOB and SGE have concluded an MoU to cooperate in proprietary trading and physical delivery of gold products and provide innovative services to ASEAN gold suppliers and investors.
- First Listing of Panda Bond in Singapore. MAS and PBC welcome the first Panda Bond to list on the Singapore Exchange - UOB’s three-year, RMB 5 billion Panda Bond
3. At the JCBC meeting, MAS also welcomed the listing of eligible Chinese companies interested to expand business operations in Southeast Asia on SGX. This is in line with CSRC’s policy of supporting eligible onshore companies to access international capital markets for growth.
4. Mr Chee Hong Tat, Minister for Transport and Second Minister for Finance, and Deputy Chairman of MAS said, “Financial cooperation has been a key pillar underpinning the strong bilateral relations between China and Singapore. The strong slate of initiatives announced today at the 20th anniversary of JCBC reflects our continued commitment to deepen financial connectivity between our markets.”
***
[1] CapitaLand Investment was the first Singapore based company to issue a 3-year sustainability linked Panda Bond totalling RMB 2 billion under the Green Corridor.
[2] The ETF Product Links between SGX and the Shenzhen and Shanghai Stock Exchanges, launched in 2022 and 2023 respectively, have improved investors’ access to ETF products in each other’s markets.
[3] UOB’s Panda Bond was issued in October 2024 with Bank of China Singapore as the lead bookrunner and underwriter.
