China, Singapore double size of bilateral currency swap facility

The central banks of China and Singapore have signed an enhanced bilateral currency swap agreement, doubling the size of the bilateral swap facility to 300 billion yuan (48 billion U.S. dollars) or 60 billion Singapore dollars (48 billion U.S. dollars), they announced on Friday.

Under the new agreement, signed on Thursday, up to 300 billion yuan in Renminbi liquidity will be available to eligible financial institutions operating in Singapore.

Correspondingly, up to 60 billion Singapore dollars in Singapore dollar liquidity will be available to eligible financial institutions operating in China.

It also enables both central banks to provide foreign currency liquidity to stabilize financial markets.

The new agreement replaces a previous currency swap arrangement dated July 23, 2010, said the People's Bank of China and the Monetary Authority of Singapore.

The effective period of the arrangement will be three years and can be extended by agreement between the two sides.

The currency swap agreement reinforces the co-operation between the two central banks to "strengthen economic ties and foster financial stability."

Bilateral trade between China and Singapore grew by 8.7 percent year on year to 69.3 billion U.S. dollars in 2012 amid the challenging global economic environment, according to official statistics from China. Singapore is China's third largest trading partner within the Association of Southeast Asian Nations.