China’s state investment arm said to be planning US$14 billion fund to support strategic new industries

China Reform Holdings, a government arm that invests in and trades equity stakes of small state-owned companies, plans to set up a fund to channel at least 100 billion yuan (US$13.7 billion) to strategically important emerging industries in the country, according to a report by China Business News.

If confirmed, the move would mark the latest efforts by Chinese state-owned funds to pump money into areas that Beijing has deemed vital, following the establishment of initiatives such as the China National Integrated Circuit Industry Investment Fund, also known as the Big Fund, which is intended to boost the domestic chip industry.

More than 20 investors have already expressed interest in investing in China Reform’s new fund, which is expected to complete fundraising and begin operation by year-end, according to the report on Sunday. They include central-government-owned enterprises, local governments and private investors.

Efforts to boost China’s industrial power come as the US pushes restrictions to bar American funding into crucial technologies in China from artificial intelligence to semiconductors and biotechnology.

Under those rules, funding recipients cannot expand chip manufacturing capacity by more than 5 per cent in leading-edge and advanced facilities in countries of concern such as China for 10 years, or by more than 10 per cent in legacy facilities.