The Monetary Authority of Singapore (MAS) and the People’s Bank of China (PBC) discussed initiatives to advance cooperation in green and transition finance between China and Singapore at the 2nd China-Singapore Green Finance Taskforce (GFTF) meeting held on 20 May 2024.
The initiatives discussed covered “the alignment of taxonomies, facilitation of green finance flows, and the development of a decarbonization rating platform.”
The GFTF was set up in 2023, “with three workstreams led by private and public sector players which focus on initiatives to scale up green and transition financing flows between Singapore, China and the region.”
The 2nd GFTF progressed “on the joint initiatives under each workstream” and discussed the following:
- Taxonomies and Definitions: MAS and PBC will complete the mapping of the Singapore Asia Taxonomy (SAT) to the International Platform on Sustainable Finance (IPSF)’s Common Ground Taxonomy (CGT) [1] by the end of this year. This will facilitate the cross-border issuance by Singapore and Chinese corporates of CGT-aligned green financing bonds and loans originated by Singapore and Chinese financial institutions.
- MAS and PBC also conducted an industry capacity building session on transition taxonomies to deepen understanding of transition activities as defined by China and Singapore respectively.
- Products and Instruments: Singapore Exchange and China International Capital Corporation are collaborating on a Green Corridor to facilitate green financing flows between Singapore and China. As a start, the workstream will focus on encouraging green panda bond issuances, given the demand from Singapore issuers to raise capital in the Chinese onshore bond market. MAS will provide support to encourage such financing flows through grant schemes such as the Sustainable Bond Grant Scheme.
CapitaLand Investment, a real asset investment management group in Asia, “was the first Singapore-based company to issue a 3-year sustainability-linked panda bond of RMB 1 billion under the Green Corridor. MAS and PBC expect this landmark issue to catalyse more of such financing flows under this workstream.”
Technology: Metaverse Green Exchange and Beijing Green Exchange are “developing a carbon accounting and decarbonization rating platform.”
The platform will, amongst other things, “aggregate Chinese corporates’ carbon emissions data to support Singapore and Chinese financial institutions in structuring green financing solutions for these corporates.”
The workstream will also study “the feasibility of aligning the decarbonization rating methodology with the CGT and SAT.”
The meeting also discussed emerging areas of interests, “including nature and biodiversity, ESG data model interoperability, and the use of artificial intelligence and data analytics through Greenprint (Gprnt) [2] and Project NovA! [3] to facilitate the collecting, accessing and harnessing of high-quality ESG data to drive green and transition efforts.”
Ms Gillian Tan, MAS’ Assistant Managing Director (Development and International) and Chief Sustainability Officer, who co-chairs the GFTF with Dr Ma Jun, Chair of the China Green Finance Committee, said:
“The GFTF is a key platform for China and Singapore to jointly develop concrete and meaningful initiatives to advance green finance cooperation. The wide range of deliverables announced today is testament to the strong collaboration between MAS, PBC and industry partners from both countries and our shared ambition to mobilise the financing required for an effective transition to net zero in the region.”
