THE Monetary Authority of Singapore (MAS) and the People’s Bank of China (PBOC) are planning to advance cooperation in green and transition finance between China and Singapore.
The central banks discussed initiatives, including the alignment of taxonomies, facilitation of green finance flows and the development of a decarbonization rating platform, at the second China-Singapore Green Finance Taskforce (GFTF) meeting held on Monday (May 20).
MAS and PBOC will complete the mapping of the Singapore-Asia Taxonomy (SAT) to the Common Ground Taxonomy (CGT) of the International Platform on Sustainable Finance (IPSF) 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,” said MAS on Tuesday.
The IPSF’s CGT, published in November 2021 and updated in June 2022, provides an in-depth comparison between the EU’s and China’s green taxonomies.
On the products and instruments front, Singapore Exchange and China International Capital Corporation will collaborate on a green corridor to facilitate and catalyse green financing flows between both countries.
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, said MAS. Singapore’s central bank is planning to support such financing flows through grant schemes such as the sustainable bond grant scheme.
Additionally, MetaVerse Green Exchange and Beijing Green Exchange are developing a carbon accounting and decarbonisation rating platform. “The platform will, among other things, aggregate Chinese corporates’ carbon emissions data to support Singapore and Chinese financial institutions in structuring green financing solutions for these corporates,” said MAS.
The technology workstream will also study the feasibility of aligning the decarbonisation rating methodology with the CGT and SAT, MAS noted.
The meeting also discussed emerging areas of interests, including nature and biodiversity, ESG data model inter-operability, and the use of artificial intelligence and data analytics through Greenprint and Project NovA! to facilitate the retrieval of high-quality ESG data.
Gillian Tan, MAS’ assistant managing director of development and international and chief sustainability officer, said at the meeting: “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, PBOC 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.”
The GFTF was set up in 2023, with three workstreams led by private and public sector players that focus on initiatives to scale up green and transition financing flows between Singapore, China and the region.
The article originally appeared on The Business Times.
