The People’s Bank of China Chongqing Operations Office (PBC Chongqing) has allowed eligible corporates and individuals in Chongqing to conduct cross-border Renminbi (RMB) transactions with financial institutions and corporates in Singapore.
PBC Chongqing’s directive issued on March 25 implements one of the agreed outcomes in financial co-operation between China and Singapore during the State Visit to Singapore in November 2015 by the President of the People’s Republic of China, Mr Xi Jinping.
The PBC Chongqing directive will allow corporates in Chongqing to issue RMB bonds in Singapore and repatriate the funds raised in full. In addition to Chongqing, the funds raised can be used outside of the municipality for the development of economic activities and infrastructure in China’s western region;
The move also allows equity investment funds in Chongqing to make direct investments outside of China, including Singapore and the ASEAN region.
Individuals in Chongqing are now also allowed to make RMB remittances to Singapore to settle current account transactions.
The initiative will facilitate greater use of RMB in the region and contribute to the growth of the offshore RMB market in Singapore. It will also strengthen financial connectivity between Chongqing and Singapore.
This will be useful in achieving the objective of enhancing modern connectivity and services in China’s western region under the China-Singapore (Chongqing) Demonstration Initiative on Strategic Connectivity, announced in November 2015.