The Monetary Authority of Singapore (MAS) has on Monday announced new green finance and capital markets initiatives to strengthen financial cooperation with China.

MAS said in a statement that 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 issuancesthrough a Green Corridor, to further catalyze green financing flows between Singapore and China.

According to the statement, 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.

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, 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.

According to the statement, 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.

MAS and PBC have welcomed the first Panda Bond to list on the Singapore Exchange – UOB’s three-year, RMB 5 billion Panda Bond ($691.36 million).

The listing of Panda Bonds in Singapore will foster greater interest and participation by international investors and issuers in the Panda Bond market.

UOB and the Shanghai Gold Exchange (SGE) have concluded a memorandum of understanding (MoU) to cooperate in proprietary trading and physical delivery of gold products and provide innovative services to ASEAN gold suppliers and
investors.

MAS has also welcomed the listing of eligible Chinese companies interested to expand business operations in Southeast Asia on SGX.

This is in line with China Securities Regulatory Commission (CSRC)’s policy of supporting eligible onshore companies to access international capital markets for growth.

“Financial cooperation has been a key pillar underpinning the strong bilateral relations between China and Singapore,

“The strong slate of initiatives announced reflects our continued commitment to deepen financial connectivity between our markets,” said Chee Hong Tat, Minister for Transport and Second Minister for Finance, and Deputy Chairman of MAS.

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