Following the decision by the MAS to carry out trials of e-CNY in collaboration with China in a bid to enhance tourism expenditure in Singapore.
In 2020, both China and Australia signed a Memorandum of Understanding (MoU) to work together for the first time. Despite the MoU not clearly stating the duration of the trial of the digital currency, it paved the way for their cooperation.
The regulatory authority issued a press statement stating that its collaboration with the People’s Bank of China, MAS, and the Digital Currency Institute of the People’s Bank of China has culminated in the development of a digital currency initiative. This groundbreaking project will empower travellers from China and Singapore to utilize E-CNY as their currency for tourism expenses in both nations.
Earlier today, amidst the grandeur of the 19th Joint Council for Bilateral Cooperation in Tianjin, fervent conversations regarding the E-CNY erupted. This momentous occasion, led by the esteemed Singapore Deputy Prime Minister and Minister for Finance, Lawrence Wong, alongside the illustrious Executive Vice Premier of the State Council from the People’s Republic of China, Ding Xuexiang, witnessed a captivating exchange on the subject matter.
What is the “E-CNY”
China has introduced its digital currency, which is essentially an electronic replica of the yuan. Unlike decentralized currencies, this digital version is primarily intended for local retail transactions. The introduction of this new currency serves to cater to the needs of a digital economy era where cash is being embraced less and less. As stated by the BIS, this initiative aligns with the public’s desire for electronic cash and also strives to enhance retail payment infrastructure while seeking to refine payment methods.
China has spent an extensive amount of time victoriously following its currency within the country’s borders. However, there are imminent intentions for China to delve into pioneering initiatives targeted at facilitating cross-border payment ventures.
Singapore Sees No Future For Private Crypto
In a recent discussion, Ravi Menon, the managing director of Singapore’s central bank, shed light on the impending decline of private cryptocurrencies that fail to meet the essential financial service criteria. Menon unveiled his vision for the future of monetary systems, putting forth three crucial elements: the emergence of central bank digital currencies (CBDCs), the tokenization of bank liabilities, and the implementation of well-regulated stablecoins.
According to a press release, Leong Sing Chiong, Deputy Managing Director of MAS, expressed satisfaction with the productive year of financial collaboration between China and Singapore. He further emphasized that MAS is highly receptive to the fresh concepts in digital finance and the connection of capital markets. These endeavours are expected to stimulate novel financial transactions between the two countries’ financial hubs and foster stronger trade and economic ties.
Singapore Exchange (SGX) and Shanghai Stock Exchange (SSE) have revealed plans to establish a connection for exchange-traded funds (ETFs) between the two nations.
Reuter reports that Singapore and China have recently reached a trade agreement that includes a significant milestone in their travel policies. From early next year, both countries will implement a 30-day visa exemption arrangement. This move aims to enhance their existing trade pact and improve travel opportunities for citizens of both nations.
Frequently Asked Questions.
Singapore and China are currently experimenting with a new form of currency specifically designed for tourism expenditure. What is this innovative digital currency called?
This virtual currency affectionately known as E-CNY has been collaboratively crafted by the Monetary Authority of Singapore (MAS) and the People’s Bank of China.
When did the China-Singapore agreement come up on this digital currency project?
In 2020, both nations came together and officially agreed upon a Memorandum of Understanding aimed at jointly collaborating on a pioneering initiative, the digital currency project.
Does the trial of digital currency in tourism spending have a designated timeframe?
The article does not furnish a distinct timeframe for the trial phase of the digital currency.
How does the E-CNY digital currency specifically affect spending in the tourism sector?
E-CNY, the innovative virtual currency, intends to boost tourism expenditure by granting the convenience of using it for transactions within Singapore and China, enabling travellers from both nations to effortlessly engage in cross-country spending.
Can the E-CNY be regarded as a currency with decentralized attributes?
Contrary to popular belief, the E-CNY does not function as a decentralized currency. Instead, it serves as China’s digital rendition of the yuan, mainly intended for facilitating domestic retail transactions.
What discussions took place between Singapore and China regarding the implementation of the digital currency?
Singapore’s Deputy Prime Minister Lawrence Wong and China’s Executive Vice Premier Ding Xuexiang recently co-chaired the 19th Joint Council for Bilateral Cooperation in Tianjin, where fruitful discussions ensued.
In the future monetary system, what elements are highlighted by Ravi Menon, the managing director of Singapore’s central bank?
Ravi Menon has a vision that comprises three vital elements: the introduction of central bank digital currencies (CBDCs), the implementation of tokenized bank liabilities, and the maintenance of well-regulated stablecoins.
According to Ravi Menon, what is Singapore’s position when it comes to privately issued cryptocurrencies?
Private cryptocurrencies that fail to meet the essential criteria for financial services are destined to gradually fade away from the currency landscape, according to Ravi Menon.
About financial cooperation between Singapore and China, what other initiatives were highlighted in the MAS press release?
New strategic ventures are highlighted in the media statement, which focuses on revolutionizing digital finance and fostering enhanced connectivity in capital markets. These endeavours have the ultimate goal of accelerating the movement of financial resources between the prominent financial hubs of the respective nations.
In addition to the digital currency pilot, what other joint endeavours were revealed between China and Singapore?
As per the two countries, the Singapore Exchange, SGX, and Shanghai Stock Exchange, SSE have jointly developed ETF link, a novel exchange-traded funds product. In the same breath, they are also working on setting up a mutual visa exemption agreement with a 30-day stay valid for travellers from both sides, starting shortly.