SWF Radar China

The WSJ’s Deal Journal blog writes that, “China is creating a merger law to protect its national security–setting up a review process similar to the Committee on Foreign Investment in the U.S., or CFIUS.”

The Financial Times reports that, “China will speed up restructuring of its state-owned enterprises in the second half of the year, forcing mergers of large conglomerates and accelerating sales of non-strategic assets across a wide range of sectors, say senior government officials.”

Pieter Bottelier of Johns Hopkins University writes at ChinaStakes.com that, “China has begun to employ its huge foreign exchange reserves for broad-based long-term development, not just as hedge against possible future balance of payments problems.”

The Economic Observer Online writes that, “An alliance formed by five Chinese state-owned firms failed to win a long-expected deep-water port construction contract in Austrialia recently. Market observers said the latest failure echoed several previous attempts by Chinese firms to secure buyouts and projects abroad. It also highlighted the distrust facing companies affiliated to the Chinese government, which was eyed suspiciously by foreign ones.”

The International Business Times reports that, “A Chinese official [Li Rongrong, chairman of the State-owned Assets Supervision and Administration Commission (SASAC)] said said on Sunday that [the Chinese] government will reduce the numbers of State-owned enterprises (SOEs) from 150 to a range of 80 to 100 and encourage some of them to IPO […] overseas.”

Brad Setser offers an answer to the question of just how much money China has, how fast its foreign assets are growing, and how much is hot money.

The Financial Times reports that, “Australia has insisted that it will not attempt to deter Chinese investment in its booming natural resources, in spite of domestic fears that foreign sovereign wealth funds could build stakes in mining companies.”

The Age reports that, “[Australian treasurer] Wayne Swan has signalled his readiness to block acquisitions of controlling stakes in Australian resource companies by Australia’s resource customers, a move that comes amid an unprecedented run of foreign investment applications from Chinese state-owned companies.”

Thomson Reuters reports that, “China will provide an additional $135 million in financing to rebuild Angola’s electricity, water and road systems, expanding its stake in the oil-rich African nation, Angola’s state-run ANGOP news agency said on Friday.”

The Oxford International Review (OIR) has published an English-language working paper (PDF) on Chinese-language literature on sovereign wealth funds, especially the CIC.

The OIR blog writes that, “The goal of this draft paper is to identify the main themes in the Chinese language press in order that we might better understand and characterize the Chinese views on the CIC–focusing on its role, mission and geopolitical impact.”