About 80 billion yuan (US$10 billion) of China's insurance fund
will flow into the railway upgrading project between Beijing and
Shanghai, one of the country's busiest railways.
Wu Dingfu, chairman of the China Insurance Regulatory
Commission, revealed this news at a recent forum on innovation and
development within China's insurance industry.
Half of the total funds needed for the railway reconstruction
project will flow from insurance companies' investments, Wu
said.
Insurance companies will inject yearly funds into the project,
he said, without clarifying the initial annual figure.
Insurance funds have become active in China's financial market.
During the first seven months of this year, investments from
Chinese insurance companies hit 1.031 trillion yuan (US$128.875
billion), up 34.77 percent over the same period last year,
according to the latest statistics revealed by the China Insurance
Regulatory Commission.
The investment returns for the Chinese insurance industry
averaged 3.6 percent in 2005, while the annual yield of the
Beijing-Shanghai high-speed railway reconstruction should range
from 8 percent to 12 percent.
China is expected to invest 1.25 trillion yuan (US$157 billion)
in railway construction in its 11th Five-Year Program (2006-10), of
which 160 billion yuan (US$20 billion) will be spent in 2006.
(Xinhua News Agency September 6, 2006)