Japan welcomes China sovereign fund with open arms

14 February 2008

China's sovereign wealth fund is most welcome to invest in Japan at a time when the country is being almost "ignored" by foreign investors, Financial Services Minister Yoshimi Watanabe said Wednesday.

 

Watanabe met earlier in the day with Gao Xiqing, visiting general manager of China Investment Corp., the $200 billion state-controlled fund. Watanabe said he asked Gao about CIC's activities.

 

"Mr. Gao visited Japan apparently because he is interested in Japanese markets, and I told him that the fund's investment is more than welcome," Watanabe told reporters. "This comes at a time of 'Japan passing' — so I'd like them to check our markets."

 

Foreign investors have been net sellers of Japanese shares in recent months, and analysts say the Japan-selling is connected with its rapidly aging society and relatively slim chances for growth in comparison with such emerging economies as China and India.

 

Watanabe said he confirmed that CIC is not putting money into foreign markets to fulfill its goals as part of China's national strategy, but that the moves are for purely investment purposes.

 

"Many questions have been raised about the activities of those (sovereign wealth) funds. It is important for them to enhance transparency and dispel these concerns," Watanabe said.

 

© Graham Bishop