People’s Republic of China: MOU of ETF Products Between China and Singapore Exchanges

By Chloe Duan and Grace Ye

Shanghai Stock Exchange (SHSE) announced that it has entered into a memorandum of understanding (MOU) with Singapore Exchange (SGX) to establish a link for exchange-traded funds (ETFs) between two exchanges. SHSE and SGX are also aiming to jointly develop more ETF products available to investors on both markets via the link.

This is not the first time that SGX has collaborated with the Chinese stock exchange. In 2021, Shenzhen Stock Exchange (SZSE) entered into a similar MOU with SGX, and three ETFs were successfully listed under the link between SZSE and SGX in 2022.

According to the data reported by SGX, the daily turnover for Chinese equities ETFs in the first quarter of 2023 grew more than 50% following the launch of two ETF products via the link between SZSE and SGX. In light of the successful collaboration with SZSE, SGX further expanded this model to SHSE and expects to provide investors from two countries with a wider range of ETF products through a master-feeder fund model via the new link.