As China’s financial markets continue to grow, the United Overseas Bank Limited (UOB), Singapore Exchange Limited (SGX), and the China Chamber of International Commerce (CCOIC) have announced a collaboration this Monday to further help Chinese businesses expand abroad.
Under the Memorandum of Understanding (MoU), Singapore will be used as a so-called launchpad for Chinese companies to expand into the ASEAN region (Association of Southeast Asian Nations).
Specifically, the MoU will allow more than 180,000 Chinese enterprises under CCOIC to benefit from both UOB’s banking knowledge as well as the market infrastructure and liquidity of SGX, the statement said.
Each organization will provide assistance, and advisory services for the companies wanted to expand abroad in relation to market entry. Each firm will also provide support in their respective areas, such as foreign exchange (forex), trade settlement, project financing, liquidity management, derivatives transactions as well as connecting Chinese companies with potential ASEAN business partners.
Commenting on the alliance, Loh Boon Chye, Chief Executive Officer (CEO) of SGX, said: “SGX is excited to partner UOB and CCOIC to support more Chinese enterprises looking to expand globally. SGX’s multi-asset fundraising, investment and risk management platforms, when placed together with UOB’s financial expertise and CCOIC’s extensive network in the Chinese business community, will add value to enterprises tapping on the growth opportunities led by China’s Belt and Road and environmental initiatives.”
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“Chinese enterprises can also benefit from Singapore’s position as a global wealth management hub and overseas RMB centre, while leveraging our strategic location in ASEAN as a springboard into the one of the world’s fastest growing regions.”
Singapore Aims to be FX and Liquidity Hub of Asia
Singapore has the current aim of being an FX and liquidity hub for Asia. As Finance Magnates reported, the Monetary Authority of Singapore (MAS) has been working towards developing the country into a global FX price discovery and liquidity center in the region, as outlined in its Financial Services Industry Transformation Map.
A report by Bloomberg last week highlighted that the country is well on its way to achieving this, as regulatory authorities are making headway in encouraging firms to start building trading engines in the country.
The MoU announced today builds upon a previous alliance between the UOB and CCOIC. This collaboration aims to facilitate Chinese enterprises’ internationalization efforts. As a result, the UOB helped 50 percent more Chinese companies expand into the ASEAN region in 2018 as compared with 2017.
“UOB is committed to providing companies the connectivity they need for their business expansion across Asia,” added Wee Ee Cheong, Deputy Chairman and Chief Executive Officer, UOB.
“For enterprises seeking opportunities in ASEAN, we have been helping them navigate market complexities and offering financial and business support through our integrated network, strong knowledge of and experience in the local markets and our ecosystem of strategic partners. With the new MOU, the combined expertise and strengths of UOB, CCOIC and SGX will help enable the success of more companies in the region.”