China's new fund to encourage private investment

BEIJING - China launched a new investment fund on Monday in an attempt to bring private capital into the energy and infrastructure sectors.

The urban infrastructure facilities investment fund was selected over other rivals and won approval from the regulatory authority because it has a background of private capital, said Huang Mengfu, chairman of the All-China Federation of Industry and Commerce, which initiated the fund.

The fund pooled 2.5 billion yuan (about $397 million) of capital for the first stage of its operation from state-owned enterprises such as PetroChina, the country's largest oil producer, and some private companies affiliated with the federation.

The fund will mainly look for investment opportunities in infrastructure facilities such as oil and gas pipeline construction, said Huang, also vice chairman of the National Committee of the Chinese People's Political Consultative Conference, China's top political advisory body.

A professional management team for the fund and its custodian bank have been selected, according to Huang.