BEIJING — China has established a new investment company to help domestic enterprises invest abroad and encourage the export of the country’s advanced industrial capacity, the national economic planner said on May 20.
The new company has been approved by the central government to run as a subsidiary of state-owned China Investment Corporation (CIC), one of the world’s largest sovereign wealth funds, and has started operation, said the National Development and Reform Commission (NDRC).
The company was established with initial capital of $5 billion and is likely to outvalue the Silk Road Fund, an infrastructure-oriented fund, said Gu Dawei, an official in charge of overseas investment department of the NDRC.
China is striving to strengthen industrial capacity cooperation worldwide, basically moving production lines abroad, which helps recipient countries create jobs and modernize while boosting China’s exports.
The ambitious plan requires enormous financial support with investment funds as a major means.
Apart from the two funds mentioned above, the country already created several other investment companies including the China-Africa Development Fund and China-ASEAN Investment Corporation Fund to back the scheme.
The country is now negotiating with Kazakhstan to develop an industrial cooperation fund worth $6 billion between the two sides, Gu said.
More financial support measures for Chinese enterprises “going global” are on the way and the government will promote cross-border settlement by renminbi, or the yuan, to facilitate trade and investment, Gu added.