Singapore, 15 November 2017… The Monetary Authority of Singapore (MAS) and the Hong Kong Monetary Authority (HKMA) exchanged a Memorandum of Understanding (MoU) in Singapore today to jointly develop the Global Trade Connectivity Network (GTCN), a cross-border infrastructure based on distributed ledger technology (DLT), to digitalise trade and trade finance between the two cities and potentially with an aim to expanding the network in the region and globally. 

2   The GTCN is the first strategic joint innovation project arising from the Co-operation Agreement signed by the two authorities last month¹. The goal of the project is to build an information highway using DLT between the National Trade Platform in Singapore and the Hong Kong Trade Finance Platform, which will make cross-border trade and financing cheaper, safer, and more efficient.

3   A Joint Working Committee comprising MAS, the HKMA, the National Trade Platform Programme Office (Singapore) and Hong Kong Interbank Clearing Limited will lead the project at the start.  The Joint Working Committee will invite other markets to participate after finalising the governance structure and implementation plan.

4   The MoU, signed between heads of the two authorities, was exchanged at the 2017 Singapore FinTech Festival organised by MAS. As part of a workshop held during the FinTech Festival, the two authorities also commenced a joint discussion with major DLT solution providers to develop business and technical models for the GTCN, which is expected to conclude in Q1 2018. The GTCN is expected to go live by early 2019, to tie in with the targeted go-live dates of the Trade Finance Modules on the National Trade Platform in Singapore and the Hong Kong Trade Finance Platform.

5   Norman Chan, Chief Executive, HKMA, said, “I am very pleased that the HKMA is joining hand with the MAS to develop a DLT-based interface linking the digital trade finance platforms in the two centres.  The GTCN is going to remove the inefficiency and risks of fraud inherent in the existing paper-based system in trade finance.  Once implemented, the interface, likely to be the first of this kind in the world, has been designed with an open architecture that would allow Hong Kong's other trading partners to plug into it in future.  We feel really excited about this project as it clearly demonstrates the HKMA's commitment to step up cross border collaboration in Fintech to better prepare Hong Kong to enter into the new Smart Banking Era.”

6   Ravi Menon, Managing Director, MAS, said, “Singapore, via the National Trade Platform, is committed to the digitalisation of trade, which will transform the industry by streamlining processes and enhancing risk management. This innovative project with Hong Kong is an excellent showcase of how two leading international financial centres in Asia can drive the transformation of trade and trade finance. ”

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About the Monetary Authority of Singapore

The Monetary Authority of Singapore (MAS) is Singapore’s central bank and integrated financial regulator.  As central bank, MAS promotes sustained, non-inflationary economic growth through the conduct of monetary policy and close macroeconomic surveillance and analysis. It manages Singapore’s exchange rate, official foreign reserves, and liquidity in the banking sector. As an integrated financial supervisor, MAS fosters a sound financial services sector through its prudential oversight of all financial institutions in Singapore – banks, insurers, capital market intermediaries, financial advisors, and stock exchanges. It is also responsible for well-functioning financial markets, sound conduct, and investor education. MAS also works with the financial industry to promote Singapore as a dynamic international financial centre. It facilitates the development of infrastructure, adoption of technology, and upgrading of skills in the financial industry.

About the Hong Kong Monetary Authority
The Hong Kong Monetary Authority (HKMA) is the government authority in Hong Kong responsible for maintaining monetary and banking stability. It was established in April 1993 by merging the Office of the Exchange Fund and the Office of the Commissioner of Banking.

The HKMA’s policy objectives are:

• to maintain currency stability within the framework of the Linked Exchange Rate System;
• to promote the stability and integrity of the financial system, including the banking system;
• to help maintain Hong Kong’s status as an international financial centre, including the maintenance and development of Hong Kong's financial infrastructure; and
• to manage the Exchange Fund.