China is rolling out the red carpet for venture capital in tech – and foreign funds are welcome
- China’s State Council has put out a call for venture capital to invest in the country’s tech sector, with incentives for funds both foreign and domestic
China plans to roll out new measures to coax venture capital (VC) – including funds based overseas – into the country’s technology sector, according to a notice from the State Council, the national cabinet.
International investors will be incentivised to set up yuan-denominated funds within China to facilitate domestic investments, the council said in the notice issued Wednesday, which named foreign backers’ investment experience and service strengths as reasons for the move.
Qualified institutions will be encouraged to issue corporate bonds and debt financing instruments to help fund their investments, and state-owned enterprises will be supported as they devote resources to industry leaders in advanced technologies. China will also support insurance institutions as they make their own investments in VC funds.
“Developing venture capital is a key step to promoting the virtuous cycle of technology, industry and finance,” the cabinet said.
As global supply chains become subject to fragmentation, the venture capital landscape is also undergoing the same constrictions
China also plans to expand its pilot programme for Qualified Foreign Limited Partnerships (QFLP) and guide foreign institutions to conduct cross-border investment within the scope of regulations, according to the council.
