China to establish $40 billion Silk Road infrastructure fund

Sat Nov 8, 2014 8:32am EST
 
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BEIJING (Reuters) - China will contribute $40 billion to set up a Silk Road infrastructure fund to boost connectivity across Asia, President Xi Jinping announced on Saturday, the latest Chinese project to spread the largesse of its own economic growth.

China has dangled financial and trade incentives before, mostly to Central Asia but also to countries in South Asia, backing efforts to resurrect the old Silk Road trading route that once carried treasures between China and the Mediterranean.

The fund will be for investing in infrastructure, resources and industrial and financial cooperation, among other projects, Xi said, according to Xinhua.

The goal of the fund is to "break the connectivity bottleneck" in Asia, state media quoted Xi as saying during a meeting in Beijing with leaders from Bangladesh, Cambodia, Laos, Mongolia, Myanmar, Pakistan and Tajikistan.

The Silk Road Fund will be "open" and welcome investors from Asia and beyond to "actively" take part in the project, Xi was cited as saying, ahead of a separate summit of the Asia Pacific Economic Cooperation (APEC) grouping, also being held in the Chinese capital.

It was not immediately clear precisely how the fund would work, when it would start operations or where it would be based, though in all likelihood it would be China.

But Xinhua said it would focus on China's Silk Road Economic Belt and the 21st Century Maritime Silk Road initiative, which aim to build roads, railways, ports and airports across Central Asia and South Asia.

"Such a framework accommodates the needs of various countries and covers both land and sea-related projects," Xi said, adding China is ready to welcome its neighbors "to get on board the train of China's development."

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China's President Xi Jinping attends a meeting in Caracas, in this July 20, 2014 file picture. REUTERS/Jorge Silva/Files