China's State Council, which is the Chinese cabinet, has announced that an insurance investment fund will be set up, with capital mainly from insurance institutions to support strategic or public projects like urban renewal, infrastructure, water conservation, transportation, and international cooperation initiatives.
The decision, made on Wednesday, envisages that the insurance investment fund would total CNY300 billion (US$48.3 billion). It said that the fund would be managed along commercial lines to invest in such projects.
In recent years, the Chinese insurance industry has developed very rapidly. Total premium revenues exceeded CNY2 trillion last year and total assets stood at more than CNY10 trillion.
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MY VIEWS:
This is an excellent approach. It should be used for countries that need to develop their infrastructure, such as India (where PM Modi wants to develop 100 smart cities) and Indonesia (where President Joko Widodo wants to upgrade their infrastructure also).
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