China seeks to invest in Europe

November 29th, 2011 | China.org.cn

Chinese Minister of Commerce Chen Deming said on Monday that his ministry will send an investment delegation to Europe in 2012 with an eye on European assets.

About one-quarter of China’s foreign-exchange reserves are in euro-denominated assets and it would be a good chance for Chinese companies to invest or buy equities in Europe, Chen said.

“Some European countries are facing a debt crisis and hope to convert their assets to cash, and would like foreign capital to acquire their enterprises,” Chen said. “We will be closely watching and pushing forward.”

“Now, infrastructure in Europe and the US badly needs more investment,” the Chairman of the China Investment Corporation (CIC) Lou Jiwei wrote in the Financial Times on Sunday.

“Traditionally, Chinese involvement in overseas infrastructure projects has been as a contractor only,” Lou said. “Now, Chinese investors also see a need to invest in, develop and operate projects.”

Lou expressed special interest in the UK, saying that the country is one of the most open economies in the world. He said that the CIS is ready to work with fund managers or participate in public-private partnerships in the UK infrastructure sector as an equity investor.

In the PPP arrangement, the government could invest with local or overseas institutional investors and share risks and returns.

“CIC believes that such an investment, guided by commercial principles, offers the chance of a ‘win-win’ solution for all,” Lou said.

Two weeks ago, CIC’s President Gao Xiqing said that China would not help other countries at the cost of its own economy.

Gao stressed that China wants profit and influence from investment, and it should only invest in assets where it could have a voice.

“We frequently meet with foreign regulators whose attitude is that we should give them money and leave everything to them. Nothing comes for free in this world,” Gao said.

Category: Europe, Finance