Monetary authorities of Singapore and China's Hong Kong Special Administrative Region exchanged a Memorandum of Understanding (MoU) in Singapore on Wednesday, according to a press release from the Monetary Authority of Singapore (MAS).
With the MoU, signed between MAS and Hong Kong Monetary Authority (HKMA), the two sides are set to jointly develop the Global Trade Connectivity Network (GTCN), a crossborder infrastructure based on distributed ledger technology, to digitalize trade and trade finance between the two sides with an aim to expand the network in the region and globally.
The GTCN is the first strategic joint innovation project arising from the cooperation agreement signed by the two authorities last month.
The goal of the project is to build an information highway using distributed ledger technology 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.
The press release said a Joint Working Committee comprising the MAS, the HKMA, the National Trade Platform Programme Office (Singapore) and Hong Kong Interbank Clearing Limited will lead the project at the start, and it will invite other markets to participate after finalizing the governance structure and implementation plan.
The MoU was exchanged at the second edition of Singapore FinTech Festival lasting from Monday to Friday.
As part of a workshop held during the FinTech Festival, the two authorities also commenced a joint discussion with major distributed ledger technology solution providers to develop business and technical models for the GTCN, which is expected to conclude in the first quarter of 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.