Post by anansi on Dec 5, 2011 10:27:26 GMT -5
China 'Keen' To Invest In West's Infrastructure
by THE ASSOCIATED PRESS
text size A A A BEIJING November 28, 2011, 10:02 am ET
BEIJING (AP) — China's sovereign wealth fund wants to invest in improving neglected U.S. and European roads and other infrastructure to spur global growth, the fund's chairman said in comments published Monday.
The announcement reflects a shift in strategy for the $410 billion fund, which was created in 2007. Until now, it has limited its investments mostly to small stakes in publicly traded companies to avoid stirring political opposition overseas.
China Investment Corp. wants to begin in Britain by teaming up with fund managers or investing directly in infrastructure projects, Lou Jiwei said in a commentary in London's Financial Times newspaper.
"China is keen to get involved" in improving U.S. and European infrastructure, which "badly needs more investment," Lou wrote. He cited energy, water, transport, digital communications and waste disposal but gave no indication of possible projects or the size of Chinese investment.
Some commentators in both Europe and China have suggested Beijing might use its $3.2 trillion in foreign reserves to gain leverage on political or trade issues at a time when other governments urgently want investment.
Also Monday, Commerce Minister Chen Deming said at a business conference that he wants to send a delegation to Europe next year to find investment opportunities, according to the director of the ministry press office, Huang Minghai. The proposal still requires Cabinet approval.
Beijing is encouraging Chinese companies to expand investments abroad to diversify an economy that relies heavily on exports and investment. It has sent trade and investment delegations in the past to the United States, Europe and elsewhere.
CIC was created to invest abroad in hopes of earning a better return on China's foreign reserves, the bulk of which are in U.S. and European government bonds. It says investments are made on commercial rather than political grounds.
The move into infrastructure probably reflects CIC's commercial views, rather than those of the government, said Citigroup economist Minggao Shen. He said it could help CIC earn a more stable profit and reduce Beijing's exposure to U.S. and European government bonds amid volatile markets.
Some Chinese commentators have called for Beijing to reduce its exposure to the financial woes of Western governments by buying fewer bonds. China is Washington's biggest foreign bondholder, with $1.15 trillion in Treasury debt as of September.
"There is a general thought that maybe China should not invest in U.S. Treasurys or European sovereign bonds. Instead, why can't we hold direct assets in the economy?" Shen said.
By investing in individual projects, he said, "you don't have to depend on government guarantees and it should be affected less by the sovereign debt crisis."
CIC faced criticism over the performance of investments made just as the financial crisis was developing. But its results have improved and the fund reported an 11.7 percent return on assets last year.
Lou stressed that CIC is a commercial investor and wants to make a profit.
"CIC believes that such an investment, guided by commercial principles, offers the chance of a win-win solution for all," he wrote.
Lou gave no indication in which other countries the CIC might invest but cited an estimate that the United States needs to spend at least $2.2 trillion in infrastructure repairs or rebuilding.
"Free of the inflationary pressure that afflicts many emerging economies, the U.S. and Europe should make substantial investment," he said. "We cannot count on developing countries to deliver a stable economic recovery on their own."
___http://www.npr.org/templates/story/story.
Portugal Seeks Aid From Angola
Luanda the worlds most expensive city
Portuguese, Angolan leaders meet
Luanda - Portuguese Prime Minister Pedro Passos Coelho met with Angolan President Jose Eduardo dos Santos on Thursday as the struggling former imperial power seeks investment from its booming ex-colony.
Passos Coelho, who arrived on Wednesday night on a visit of just over 24 hours, is looking to strengthen trade ties and discuss Angola's interest in buying shares in Portuguese state companies.
"We should take advantage of this moment of financial and economic crisis to strengthen our bilateral relations in the different sectors of our respective countries," he told AFP.
"Angola is in the middle of rebuilding its democratic institutions to establish its young democracy after many years of armed conflict," he said on leaving a meeting with the speaker of Angola's parliament, Antonio Paulo Kassoma.
Angola won its independence from Portugal in 1975, but descended into a 27-year civil war that ended only in 2002.
It has been rebuilding at breakneck speed in the nine years since, thanks largely to oil deposits that make it Africa's second-largest petroleum producer.
Its economy is set to grow 12%next year, while Portugal's is facing a 2.8% shrinkage.
That gloomy outlook has forced Portugal to sell off state companies under a €78bn International Monetary Fund bailout deal.
Outstanding debt
Air carrier TAP, utilities company Energias de Portugal, the failing Banco Portugues de Negocios, and national grid operator Redes Energeticas Nacionais are all on the block.
Dos Santos said Angola is ready to help its former colonial ruler, according to state news agency Angop.
"We're aware of the difficulties the Portuguese people have faced recently to end the crisis," he was quoted as saying after the pair met.
Passos Coelho lived in Luanda as a child, when his father was a colonial-era doctor.
He was later scheduled to address a meeting of Portuguese and Angolan business leaders on economic relations between the two countries and the Angolan government's outstanding debt to Portuguese construction firms.
Angola fell behind on payments to the companies when oil prices fell in 2009. It owed foreign contractors an estimated $9.0bn in July 2010, but has been working to pay them back with the help of a $1.4bn IMF loan.
www.news24.com/Africa/News/Portuguese-Angolan-leaders-meet-20111117
by THE ASSOCIATED PRESS
text size A A A BEIJING November 28, 2011, 10:02 am ET
BEIJING (AP) — China's sovereign wealth fund wants to invest in improving neglected U.S. and European roads and other infrastructure to spur global growth, the fund's chairman said in comments published Monday.
The announcement reflects a shift in strategy for the $410 billion fund, which was created in 2007. Until now, it has limited its investments mostly to small stakes in publicly traded companies to avoid stirring political opposition overseas.
China Investment Corp. wants to begin in Britain by teaming up with fund managers or investing directly in infrastructure projects, Lou Jiwei said in a commentary in London's Financial Times newspaper.
"China is keen to get involved" in improving U.S. and European infrastructure, which "badly needs more investment," Lou wrote. He cited energy, water, transport, digital communications and waste disposal but gave no indication of possible projects or the size of Chinese investment.
Some commentators in both Europe and China have suggested Beijing might use its $3.2 trillion in foreign reserves to gain leverage on political or trade issues at a time when other governments urgently want investment.
Also Monday, Commerce Minister Chen Deming said at a business conference that he wants to send a delegation to Europe next year to find investment opportunities, according to the director of the ministry press office, Huang Minghai. The proposal still requires Cabinet approval.
Beijing is encouraging Chinese companies to expand investments abroad to diversify an economy that relies heavily on exports and investment. It has sent trade and investment delegations in the past to the United States, Europe and elsewhere.
CIC was created to invest abroad in hopes of earning a better return on China's foreign reserves, the bulk of which are in U.S. and European government bonds. It says investments are made on commercial rather than political grounds.
The move into infrastructure probably reflects CIC's commercial views, rather than those of the government, said Citigroup economist Minggao Shen. He said it could help CIC earn a more stable profit and reduce Beijing's exposure to U.S. and European government bonds amid volatile markets.
Some Chinese commentators have called for Beijing to reduce its exposure to the financial woes of Western governments by buying fewer bonds. China is Washington's biggest foreign bondholder, with $1.15 trillion in Treasury debt as of September.
"There is a general thought that maybe China should not invest in U.S. Treasurys or European sovereign bonds. Instead, why can't we hold direct assets in the economy?" Shen said.
By investing in individual projects, he said, "you don't have to depend on government guarantees and it should be affected less by the sovereign debt crisis."
CIC faced criticism over the performance of investments made just as the financial crisis was developing. But its results have improved and the fund reported an 11.7 percent return on assets last year.
Lou stressed that CIC is a commercial investor and wants to make a profit.
"CIC believes that such an investment, guided by commercial principles, offers the chance of a win-win solution for all," he wrote.
Lou gave no indication in which other countries the CIC might invest but cited an estimate that the United States needs to spend at least $2.2 trillion in infrastructure repairs or rebuilding.
"Free of the inflationary pressure that afflicts many emerging economies, the U.S. and Europe should make substantial investment," he said. "We cannot count on developing countries to deliver a stable economic recovery on their own."
___http://www.npr.org/templates/story/story.
Portugal Seeks Aid From Angola
Luanda the worlds most expensive city
Portuguese, Angolan leaders meet
Luanda - Portuguese Prime Minister Pedro Passos Coelho met with Angolan President Jose Eduardo dos Santos on Thursday as the struggling former imperial power seeks investment from its booming ex-colony.
Passos Coelho, who arrived on Wednesday night on a visit of just over 24 hours, is looking to strengthen trade ties and discuss Angola's interest in buying shares in Portuguese state companies.
"We should take advantage of this moment of financial and economic crisis to strengthen our bilateral relations in the different sectors of our respective countries," he told AFP.
"Angola is in the middle of rebuilding its democratic institutions to establish its young democracy after many years of armed conflict," he said on leaving a meeting with the speaker of Angola's parliament, Antonio Paulo Kassoma.
Angola won its independence from Portugal in 1975, but descended into a 27-year civil war that ended only in 2002.
It has been rebuilding at breakneck speed in the nine years since, thanks largely to oil deposits that make it Africa's second-largest petroleum producer.
Its economy is set to grow 12%next year, while Portugal's is facing a 2.8% shrinkage.
That gloomy outlook has forced Portugal to sell off state companies under a €78bn International Monetary Fund bailout deal.
Outstanding debt
Air carrier TAP, utilities company Energias de Portugal, the failing Banco Portugues de Negocios, and national grid operator Redes Energeticas Nacionais are all on the block.
Dos Santos said Angola is ready to help its former colonial ruler, according to state news agency Angop.
"We're aware of the difficulties the Portuguese people have faced recently to end the crisis," he was quoted as saying after the pair met.
Passos Coelho lived in Luanda as a child, when his father was a colonial-era doctor.
He was later scheduled to address a meeting of Portuguese and Angolan business leaders on economic relations between the two countries and the Angolan government's outstanding debt to Portuguese construction firms.
Angola fell behind on payments to the companies when oil prices fell in 2009. It owed foreign contractors an estimated $9.0bn in July 2010, but has been working to pay them back with the help of a $1.4bn IMF loan.
www.news24.com/Africa/News/Portuguese-Angolan-leaders-meet-20111117