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1. Good morning, ladies and gentlemen.
2. Two months ago, Singapore had the privilege of welcoming Chongqing Municipal Party Secretary Mr Chen Min’er. SGX also had the opportunity to host a Singapore Financial Institutions Dialogue chaired by Mr Chen.
3. These meetings are important in expanding the cooperation and connectivity between Chongqing and Singapore, as well as to Southeast Asia and beyond.
Rising role of Singapore as a connector and facilitator of BRI
4. Singapore has been an early supporter of the BRI and is the largest destination for Chinese investments out of China into the BRI countries[1]. In line with BRI’s key goals[2], financial connectivity is one of the areas where Singapore is well-placed to play a greater role in, together with Chongqing.
5. Singapore is a neutral and internationally recognised jurisdiction for global players. Being the only country in Asia with AAA rating, we are a trusted global wealth management hub with S$3.4 trillion of assets under management. Singapore is also the third largest FX centre globally, and one of the largest offshore RMB centres in the world.
Funding the long-term development of BRI in a sustainable manner
6. I would like to highlight three areas where SGX can jointly work with Chongqing and other regions to pursue 6. mutual development.
7. First, as Asia’s most international multi-asset exchange, SGX offers equity and fixed income platforms for enterprises looking to internationalise as well as fund BRI projects. SGX can help the growing number of Chinese enterprises keen to expand regionally to tap international capital.
8. Over 40% of the market capitalisation of companies listed on SGX are international companies. Greater China companies account for about 20% of SGX-listed companies, by market cap.
9. As the largest hub for real estate investment trusts (REITs) and business trusts in Asia, Chinese issuers can also tap our cross-border platform to raise funds and monetise assets.
10. Over the last 5 years, our listed companies raised 4 times more funds through the secondary market than at IPO.
11. Our debt securities platform, Asia’s largest and most international, provide another avenue to access international investors. We have had over 6,600 listed bonds from 56 countries, listed in over 20 currencies with more than US$2.2 trillion amount issued. About 15% of the active bond issuers on SGX are from Greater China. An SGX listing provides the transparency and disclosure which international investors are increasingly demanding.
12. Second, a wider suite of risk management tools can help facilitate more investments and trade along the BRI. SGX has deep experience in this area, being the only exchange that offers a comprehensive range of Asian-centric risk management solutions on a single platform.
13. SGX is one of the leading clearing houses in the world accepting offshore RMB for margin collaterals, clearing and settlement. As Asia’s largest FX exchange, we also support the internationalisation of China’s currency market.
14. As demand for raw materials increase to meet infrastructure projects along the Belt and Road, we can expect an increase in demand for hedging solutions. Having pioneered the iron ore derivatives market a decade ago, SGX has since built a “virtual steel mill” of iron ore, coking coal and freight derivatives.
15. This brings me to my last point, and that is sustainability. The success of BRI is dependent on every stakeholder’s ability to incorporate Environmental, Social and Governance (ESG) considerations into their projects.
16. Capital market solutions like green bonds can help finance green investments. China has been successful in developing its green bond market and is increasing its focus on the ‘greening’ of BRI. SGX is one of the market leaders in global green bond issuances in Asia, with over 100 international sustainability bonds and amounts issued of more than US$35 billion. There is a lot more that Singapore and SGX can do to jointly promote green investments aligned with international standards and disclosures.
Collaborate to Succeed
17. In closing, I would like express SGX’s commitment to continue working closely with Chongqing to advance BRI’s goals. We have entered into several partnerships, including with the CCI Administrative Bureau and the Chongqing Municipal Financial Regulatory Bureau. Just yesterday, we signed a strategic collaboration with Chongqing Share Transfer Center.
18. Collaboration is key to mutual success and we look forward to doing more, together.
19. 有世界的参与，我们才能做的更好。互惠，共生，双赢。谢谢！
[1] Speech by DPM Heng Swee Keat at Singapore Shanghai Comprehensive Cooperation Council meeting
[2] The BRI’s 5 key goals are policy coordination, facilities connectivity, unimpeded trade, financial integration and people-to-people bonds.
