China to Use $10 Billion for Investment Entity, Reuters Reports
China’s central bank plans to provide $10 billion for a new entity that will help state-owned companies make investments abroad, Reuters reported, citing four unidentified people with direct knowledge of the matter.
The People’s Bank of China is in discussions with China Reform Holdings Corp., a government entity controlled by the State-owned Assets Supervision and Administration Commission, to set up a joint venture, the news service said today on its website.
China has accumulated $3.3 trillion in foreign-exchange reserves, the most in the world, boosted by trade gains. The second-largest economy has pledged to invest in Europe’s bailout funds and sustain holdings of euro assets.
China Investment Corp., the nation’s sovereign wealth fund, received $30 billion of capital from the State Administration of Foreign Exchange by the end of last year, Executive Vice President Jesse Wang said in March.
Chairman Lou Jiwei said earlier this year the sovereign fund had received additional capital after having invested almost all its cash in 2010. CIC was set up in 2007 with $200 billion from the Ministry of Finance. It had $410 billion of assets at the end of 2010.
The central bank’s press office didn’t pick up phone calls placed by Bloomberg News outside of regular business hours.
--Scott Lanman. With assistance from Zheng Lifei in Beijing. Editor: Sunil Jagtiani
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