Beijing: In a bid to internationalise the yuan, China on Monday announced direct currency trading with the Singapore dollar, a move that will help in bilateral trade and investment.
The announcement was made by Chinese Vice Premier Zhang Gaoli during a series of meetings between senior officials from both the countries, co-chaired by Zhang and Singaporean Deputy Prime Minister Teo Chee Hean in Suzhou city of Jiangsu Province in eastern China.
The move is crucial for the formation of a direct exchange rate between the Chinese yuan and Singapore dollar.
It will help reduce exchange costs for economic players and promote the use of each other's currency in bilateral trade and investment, state-run Xinhua news agency quoted the People's Bank
of China as saying.
The direct trading programme in China Foreign Exchange Trade System is not only expected to strengthen the financial cooperation between China and Singapore, but also to help the internationalisation of yuan in southeast Asia and the world.
As the second largest economy, China has seen the yuan take on a bigger role in the international market.
In late September, China allowed direct trading of the yuan against the Euro.
Similar trading arrangements have also been made with the US dollar, the Japanese yen, the Australian dollar, the British pound and New Zealand dollar.
Apart from financial cooperation, China and Singapore also agreed to strengthen partnership in sustainable development, culture and economic transformation.
Both sides signed cooperation documents ranging from intellectual property rights and exchange programs between middle-to-senior officials in education and environmental protection, the report said.
Acknowledging the outstanding achievements of bilateral flagship cooperation projects, Chinese and Singaporean officials discussed future development of the industrial park and agreed to make the eco-city project a pilot program for China's green development.
The Suzhou Industrial Park and the Tianjin Eco-City are exemplary models in cooperation between China and Singapore.
Singapore is willing to work with China to advance the two projects, Teo said.
As China and Singapore will celebrate the 25th anniversary of diplomatic ties in 2015, the Communist nation is willing to enhance strategic trust and cooperation with Singapore to give the bilateral ties a bigger boost, Zhang said.
