China and Singapore have strong and comprehensive bilateral ties 5 Singapore-China relations too are growing and evolving, in step with the development of our economies and societies. The relations between our two countries began a new era after the first official visit to Singapore by late Chinese leader Deng Xiaoping in 1978. He and Mr Lee Kuan Yew paved the way for stronger diplomatic and economic ties between Singapore and China. 6 With regard to merchandise trade, China was Singapore’s 3rd largest trading partner last year. In services, China has been also our 5th largest export destination. Singapore was China’s 13th largest trading partner in terms of merchandise trade in 2012. Singapore was also the third largest source of FDI into China last year, after Hong Kong and Japan. 7 Bilateral trade was further boosted with the signing of the China-Singapore Free Trade Agreement (CSFTA) in September 2008 in Beijing. This was the first comprehensive bilateral FTA that China signed with another Asian country. It has led to greater cross-border economic links between our two countries. 8 Multiple Sino-Singapore economic projects are also evidence of our deep relationship, including the Suzhou Industrial Park which would be celebrating its 20th Anniversary in 2014 and the Tianjin Eco-City which would be celebrating its  BIS central bankers’ speeches  1  5th Anniversary this year.
13 As a central bank, MAS enjoys warm and substantive relations with our counterparts in the People’s Bank of China (PBC). We have been in close coordination with PBC over the past year to enable cooperation in the RMB business and related arrangements. 14 PBC has recently appointed the Singapore branch of ICBC as the RMB clearing bank in Singapore earlier this year. ICBC has been working closely with the industry since then to prepare for the offering of their RMB clearing and settlement services. I am delighted to share that ICBC has officially launched RMB clearing services yesterday. Key banks in Singapore are ready to actively participate in this promising new market. 15 MAS also has growing relations with the key sectoral regulators, namely the China Banking Regulatory Commission (CBRC), China Securities Regulatory Commission (CSRC) and China Insurance Regulatory Commission (CIRC). MAS and CBRC currently hold annual meetings to exchange views on regulatory cooperation and market developments. MAS also plans to step up its engagements with CSRC and CIRC in areas of common interest. 16 These initiatives clearly indicate the increasing importance and connectivity between the financial markets of our two countries. Certainly, we hope for more of such bilateral collaborations as China continues the progressive internationalisation of its financial market and currency. 17 MAS therefore sees great value in establishing a physical presence here to facilitate such future cooperation and regular interactions.