ST PETERSBURG: China Investment Corporation (CIC), a sovereign wealth fund responsible for managing part of China’s foreign exchange reserves, is keen to explore investment opportunities in Russia and expand its exposure to the country, its CEO said yesterday.
Russian President Vladimir Putin has been courting partners in Asia as Europe and the United States seek to isolate him over Moscow’s annexation of Ukraine’s Crimea peninsula. Putin’s most notable recent success in this area was the signing of a $400bon gas supply deal with China on Wednesday.
“CIC has invested several billions of dollars in Russia and we focus on the medium and long-term prospects,” said Ding Xuedong in a Russian television interview on the sidelines of the St Petersburg International Economic Forum.
“We will continue to increase our investment in Russia, not only in the public markets but in direct investments as well, such as agriculture and infrastructure.”
CIC invests in Russia via a joint venture with the state-backed Russian Direct Investment Fund, as well as investing directly itself.
Its joint venture said this week that it plans to raise an $800 million fund to invest in infrastructure for senior citizens and to tap rising Sino-Russia tourism.
CIC subsidiary Chengdong Investment Corp also holds a 12.5 percent stake in Russian potash company Uralkali.
“Currently our investment concentrates on markets in the United States or Europe,” Xuedong said. “Our exposure to Russia is relatively small, which means the potential is big. We focus on the long term and on increasing our exposure to Russia.”
He said he is quite optimistic about the prospects for the Russian market, particularly for agriculture and energy.
Xuedong said that in the coming 10 to 20 years infrastructure will provide the most lucrative and attractive opportunities in the Asian region and said that Russia should “renew and update” its infrastructure.
Reuters
