Silk Road Fund
TypeState backed investment fund
IndustryInvestment management
Founded2014 (2014)
Headquarters2/F Tower B, Winland IFC, 7 Financial Street, Beijing
Key people
Jin Qi (Chairman of The board of directors)
Wang Yanzhi (Executive Director and President)
Yang Zejun (chairman of the board of Supervisors)
AUMUS$40 billion (2023)
OwnerState Administration of Foreign Exchange, Export Import Bank of China, China Investment Corporation, China Development Bank
Websitewww.silkroadfund.com.cn
Silk Road Fund
Simplified Chinese丝路基金

The Silk Road Fund (Chinese: 丝路基金) is a China Government Guidance Fund to foster increased investment in countries along the Belt and Road Initiative (formerly One Belt, One Road), an economic development initiative primarily covering Eurasia. The Chinese government pledged US$40 billion for the creation of the investment fund established on 29 December 2014.[1]

Significance

The Silk Road Fund is the only one of China's sovereign funds which was formed with an explicit geo-economic strategic mission.[2]: 21  It was created by President Xi Jinping to advance the policies and priorities of the Belt and Road Initiative and has closely followed the BRI's focus on infrastructure, connectivity, resource development, and developing industrial capacity.[2]: 160–161 

As per China's pledges via the Forum on China-Africa Cooperation (FOCAC), the Silk Road Fund is among the Chinese institutions which have provided development funds to African countries.[3]: 75  Along with the China Development Bank and the Export-Import Bank of China, the Silk Road Fund is one of the primary financing sources for BRI projects in Africa.[3]: 245 

Personnel

The senior executives are all from four shareholders and officials from People's Bank of China have taken most of the posts as the biggest holder, State Administration of Foreign Exchange, is a subordinate body of the Central Bank. For instance, the chairman of board of directors, Jin Qi, was formerly the assistant governor of the People's Bank of China. And the most important executive post,[4] General Manager, was assigned to Wang Yanzhi, the Director of Foreign Exchange Reserves to Entrust Loan Office of State Administration of Foreign Exchange.[5]

The structures of board of directors and supervisors represent the balance of power between OBOR related institutions. In the board of directors, four relevant ministries of the State Council of China, including Ministry of Foreign Affairs, National Development and Reform Commission, Ministry of Finance and Ministry of Commerce, and four shareholders respectively send one midlevel official to delegate in the board.[6] In the board of supervisors, with Yang Zejun, former Secretary-general of the Office of the Central Financial Leadership Group, acting as chairman, senior executives from CIC, CDB and IEBC share the seats with two other staff representatives.[7]

Stakeholders

Unlike other funds, whose organizational forms are mainly limited partnership, private equity (PE) in particular, Silk Road Fund is a limited liability company. Its 4 shareholders are: State Administration of Foreign Exchange (65%),[2]: 160–161  China Investment Corporation (15%), Export-Import Bank of China (15%) and China Development Bank (5%). The Fund has a total capital of 40 billion, and the first round of capital installment is US$10 billion, contributed by the shareholders accordingly.[8]

Connections with People's Bank of China

Silk Road Fund is semi-directly under the supervision of People's Bank of China. Its Party Organizational Relations are under the management of PBOC. For instance, on 18 January 2016, the Governor of PBOC, Zhou Xiaochuan participated in the Meeting of Democratic Life with the Party Committee of Silk Road Fund and gave instructions on Fund operation and Party building after the management team reported the work and their criticism and self-criticism.[9] In the Chinese political system, participation in Meeting of Democratic Life means supervision and superiority.

Investments

Until August 2017, the committed investment of Silk Road Fund is US$6 billion and equity investment accounts for nearly 80%, according to the chairman JIN Qi, and the number of its invested projects was 15 by May 2017.[10]

See also

References

  1. 1 2 "Silk Road Fund's 1st investment makes China's words into practice". Xinhua News Agency. 21 April 2015. Archived from the original on 9 September 2015.
  2. 1 2 3 Liu, Zongyuan Zoe (2023). Sovereign Funds: How the Communist Party of China Finances its Global Ambitions. The Belknap Press of Harvard University Press. ISBN 9780674271913.
  3. 1 2 Murphy, Dawn (2022). China's Rise in the Global South: the Middle East, Africa, and Beijing's Alternative World Order. Stanford, California: Stanford University Press. ISBN 978-1-5036-3009-3.
  4. ↑ "CV of JIN Qi" 丝路基金公司启动 央行行长助理金琦任董事长. 观察家. Retrieved 6 December 2017.
  5. ↑ "Wang Yanzhi's former post" 丝路基金主要高管已到位. 财新网. Retrieved 6 December 2017.
  6. ↑ "Board of Directors". Board of Directors. Silk Road Fund. Retrieved 6 December 2017.
  7. ↑ "Board of Supervisors". Board of Supervisors. Silk Road Fund. Retrieved 6 December 2017.
  8. ↑ "Stakeholders of SRF". 公司概况. Silk Road Fund. Retrieved 6 December 2017.
  9. ↑ 周小川行长参加丝路基金2016年党委民主生活会. 中国人民银行. Retrieved 6 December 2017.
  10. ↑ "丝路基金董事长接受<中国金融>专访". 丝路基金. Retrieved 6 December 2017.
  11. ↑ Jeremy Page (8 November 2014). "China to Contribute $40 Billion to Silk Road Fund". The Wall Street Journal.
  12. ↑ "China's $40b Silk Road Fund signs MoU with Russian firms". China Daily. 3 September 2015.
  13. ↑ "Hassyan Clean Coal Project, Dubai". Hassyan Clean Coal Project, Dubai. Power Technology. Retrieved 6 December 2017.
  14. ↑ "DEWA inaugurates Noor Energy 1, Dubai".
  15. ↑ 丝路基金入股俄天然气化工巨头西布尔集团. 观察家. Retrieved 6 December 2017.
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