China's sovereign wealth fund launched a mutual fund with a national investment company from Belgium to help Chinese companies boost investments in the country as well as in the European Union.
China Investment Corporation and Belgium's Federal Holding and Investment Company signed an agreement in Brussels on Wednesday launching the China-Belgium Mirror Fund.
Belgium will become a very important platform for Chinese companies to expand in all 27 member countries of the EU, said Vice-Premier Li Keqiang.
China Investment Corporation didn't disclose the exact amount of the fund, nor the industries the money may be injected into.
Chinese companies are welcome to invest in Belgium and financial cooperation is deepening between the two countries, said Belgian Deputy Prime Minister and Foreign Minister Didier Reynders.
The amount of China's direct investment in Belgium was $45.33 million in 2010, reaching $101 million in total direct investment stock, 77.5 percent higher than at the end of 2009, a report from the Ministry of Commerce showed.
"The Belgian government hoped the country could become a gateway to Europe for China," said Reynders on Wednesday.
It is the first mirror fund that China set up in the eurozone, which is seen as a landmark for the relationship in terms of financial cooperation between the two large economies, said Wang Tianlong, an economist with the China Center for International Economic Exchanges, a government think tank.
The European Union's open markets are ready for investment from China, as they are now the top destination for China's outbound direct investment, Davide Cucino, president of the EU Chamber of Commerce in China, said in an e-mail to China Daily.
"We have seen some notable investment projects from China in the European automotive sector and in construction, which is likely to continue increasing in the coming years," said Cucino. "Also we hope that can expand to other areas, including information and communications technology."
Jin Liqun, chairman of the China Investment Corporation supervisory board, told CNBC in April that the company was seeking investment opportunities in European countries, and it will focus on water conservancy, electricity and real estate.
Jin predicted that the amount of investment in Europe may increase to 20 percent of the corporation's portfolios, CNBC reported.
Broader negotiations about Sino-European investment should start as soon as possible to achieve the common goal of boosting economic growth, said Xu Xianping, deputy minister of the National Development and Reform Commission.
"China's investment in the European Union is expected to increase in the coming years," said Cucino. "The European Union continues to offer opportunities for investment and cooperation between the two sides."
Source:china.org