At the 2nd China International Private Equity Forum, SSF's Dai Xianglong said that equity fund development is crucial for China's economy and put forward four related proposals.
Equity fund development plays a key role in improving macro-economic structure, improving the international balance of payments, and strengthening liquidity management in China, said Dai Xianglong, chairman of the National Council for Social Security Fund (SSF), in Tianjin on June 10.
Dai was there attending the 2nd China International Private Equity Forum (CIPEF). In his keynote speech, "Participating in international capital flow and building an innovative direct financing platform", Dai made the following four proposals:
-- Define both industry investment funds and private equity funds as equity funds. Accelerate the examination and approval process of the equity funds regulation in line with the current Securities Investment Funds Law, in order to increase the ratio of direct financing in China.
-- Conduct more equity investment pilot projects in China.
-- Develop and import more financial talent both at home and abroad.
-- Step by step, build Tianjin into an equity fund center of excellence covering creation, management, trade, information and training of talent in China.
Dai noted that 10 funds have been approved or are being processed by relevant government authorities and these 10 funds represent 120 billion yuan. China's equity fund development is not hindered by lack of capital but by shortage of talent.
He therefore suggested that as quickly as possible more people should be trained to manage such funds, and that fund management companies jointly held by Chinese and foreign capital should be approved.
Dai's view is that Tianjin is a major economic center in north China and a new source for economic growth following Shenzhen and Shanghai. He believes that carrying out equity fund reform in Tianjin would help other cities to play a bigger role under the government's integrated planning and would boost China's modern finance industry.
Dai also expressed the wish to cooperate with both domestic and overseas equity funds. He noted that these corporations will promote an orderly, mutual and successful capital flow in China.
Dai also disclosed that the SSF had decided to invest in the RMB fund jointly established by CDH Investments and Hony Capital.
(China.org.cn by Yan Pei, June 11, 2008)