The government of Chongqing has signed a memorandum of cooperation with Asia-focused bank Etech Securities to set up the Chongqing Etech Equity Investment Fund, according to data provider Evalueserve.
The fund is reportedly targeting $731 million, of which $292.5 million will be raised from international investors, another $292.5 million from Chinese provinces and cities, and the remaining $146 million from Chongqing enterprises.
Chongqing's first joint venture private equity fund with a foreign partner will target the equities of Chinese businesses and infrastructure industries, which have plummeted in value due to the current financial crisis, the report said.
The Chinese government has been trying to promote private equity investments in various Chinese cities in a bid to open up financing channels following the credit crunch. Beijing and Tianjin have been allowed by the Chinese government to give foreign investment funds legal status. In August 2008, Shanghai released its guidelines on equities investment.
Chongqing’s is the largest of China’s province-level municipalities and is located in the western region of the country.
Headquartered in the US, Etech Securities manages over $1 billion in retail assets and has eight affiliated offices and branches globally.