China-Singapore investment fund underway

China is reportedly close to approving the launch of a Singapore-China private equity fund that aims at boosting investments at Suzhou Industrial Park.

China’s National Development and Reform Commission is expected to approve the establishment of a private equity fund called China-Singapore Hi-tech Industrial Investment Fund, according to China Daily, a local newspaper citing unnamed sources.

Supported by the China-Singapore Suzhou Industrial Park China Council, the fund is modeled after Bohai Industrial Investment Fund, which was established in December with 20 billion yuan ($2.6 billion; €1.9 billion) to provide funding for companies that struggle to access bank loans in Tianjin’s Binhai New Area.

The Council, chaired by China’s Vice-Premier Wu Yi, reached an agreement with Singapore’s deputy Prime Minister Wong Kan Seng in July to expand cooperation in Suzhou Industrial Park, a project that was launched in 1994 in China’s Jiangsu province.

Suzhou Industrial Park has also decided to shift its focus from simple manufacturing to “hi-tech and business process outsourcing value-added industries,” and the China-Singapore private equity fund is expected to facilitate the transformation, according to a source on China Daily.

The park’s administration committee has applied to the Chinese economic planning agency to raise up to 10 billion yuan, with 3 billion yuan earmarked for the first phase, according to the source.

The report identified China Life Insurance and China Development Bank as the potential fund sponsors.