Venture Capital Group FormsA non-profit professional organization to promote venture capital investments in China was established Monday in Beijing.The Venture Capital Profession Commission of Science and Technology was set up to help China's new and high-tech enterprises find funders. More than 160 people from domestic venture capital companies and related research institutes attended the commission's first conference, and representatives from venture capital companies in Shenzhen and Shanghai made speeches. The conference will be held every four years, and the executive committee will meet each year. Cheng Siwei, vice-chairman of the National People's Congress (NPC) Standing Committee, who is also a senior consultant for the commission, said more laws governing the operation of venture capital are in the pipeline. He said China's venture capital had made progress in recent years, although there were still many problems. "The government attaches great importance to venture capital, and laws towards it are expected to be deliberated at the NPC this year," Cheng said in a paper at Monday's meeting. He indicated that such a law might come into force in 2003 if related issues were worked out. Statistics from the Ministry of Science and Technology indicate that by the end of 1999, China had 92 venture capital companies with some 7.2 billion yuan (US$870 million) of funds, but only 10 per cent of the cash was invested in new enterprises. Cheng said China will issue regulations and policies to encourage the development of the venture capital industry. The expected launch of the Second Board Stock Market in Shenzhen will give venture capital enterprises good opportunities to make profits through investing in new and high-tech enterprises. "They can realize profits through those new enterprises being listed," Cheng said. Some 80 per cent of China's venture capital is from State investment, and only 20 per cent is from foreign and private investors. Cheng indicated that China's venture capital companies should do their best to attract investment from private investors. "Most private capital is deposited in banks or on stock markets. If we let people know about the opportunities in the venture capital industry, huge amounts of private investment might surge into this profitable field," Cheng said. Source: China Daily |
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