© Chris Lim
A joint initiative between Singapore, China and Europe has compared their respective green taxonomies to facilitate cross-border green loans and bonds aimed at funding sustainable investment projects.
As part of the International Platform on Sustainable Finance (IPSF), the Monetary Authority of Singapore (MAS) joined the initiative already agreed to by the European Commission and the People’s Bank of China (PBoC), and builds on the existing EU-China common ground taxonomy.
The multi-jurisdiction common ground taxonomy (M-CGT) is a set of environmental objectives and criteria which are a reference for financial intuitions and investors to determine what is a “green” investment and is designed to help facilitate cross-border financial flows.
“This will enable easier comparison of the green taxonomies of Singapore and China and facilitate the provision of cross-border green loans, green bond issuance and fund investments,” MAS said in a statement. It noted that the M-CGT could also serve as a reference for other jurisdictions developing their green taxonomies to help increase interoperability.
Ma Jun, co-chair of the IPFS taxonomy working group, said: “The fact that [the common ground taxonomy] has already been used by several jurisdictions as a building block for taxonomy development suggests that M-CGT will have a greater potential to help assist other countries in developing their sustainable finance markets.”
The comparison mapping activity found that 60% of common activities were clearly defined across the manufacturing, transportation, water and waste sectors. In addition, criteria for 5% of activities, mostly in the electricity and construction sectors, were aligned across all taxonomies. Meanwhile, the criteria for 33% of activities were not directly comparable.
MAS and the PBoC created a green finance taskforce in 2023 and announced in May they would more closely align their taxonomies and develop a new platform for sharing companies’ environmental data.
The MAS also noted that companies from the two countries have already been collaborating on bond issuances. In July, CapitaLand Investment became the first Singapore-based company to issue a green Panda bond aimed at funding projects to promote renewable energy, energy efficiency and sustainable water management.
This page was last updated January 6, 2025
Written by
Moriah Costa is the Editor-in-Chief of Green Central Banking and has over a decade of experience writing about banking and finance. She is an award-winning American journalist based in Paris and has written for major international publications, including Reuters, The Guardian, and S&P Global. Having grown up in water-stressed Arizona, she has always had a strong interest in bringing awareness to climate and environmental issues.
