BEIJING Dec 2 China may channel part of
its huge pool of foreign exchange reserves into investment in
U.S. infrastructure, including rail and transportation networks,
Commerce Minister Chen Deming said on Friday.
"China is unwilling to take on too much U.S. government
debt. We are willing to turn that money into investment," he
told U.S. Ambassador to China Gary Locke and U.S. businessmen.
Chen did not elaborate on how China might channel some of
the country's war chest of $3.2 trillion foreign currency
reserves to invest in U.S. infrastructure, such as rail and
"U.S. infrastructure in some areas needs rebuilding, for
example its electricity grid, railways and transportation
networks," he said.
"This type of investment, even more, can help resolve the
unemployment issue in the United States," he added.
Analysts believe about 70 percent of China's currency
reserves have been invested in dollar-denominated assets,
including Treasuries, despite Beijing's gradual efforts to
diversify away from the dollar.
They don't expect China to dump its holding of U.S.
Treasuries for fear that such a move could hurt the U.S. fragile
economic recovery, which in turn undermine China's growth.
Chen said the U.S. government should make its policies on
foreign investment more transparent.
In return, Locke said "we can and we must facilitate more
Chinese investment into the United States."
Other Chinese officials have also expressed interest in
boosting investment in infrastructure in Western countries.
China is keen to invest in the ailing infrastructure of
Western countries, especially Britain, the chairman and chief
executive of the Asian country's sovereign wealth fund wrote in
the Financial Times.
China will expand imports from the United States next year,
Chen said, reiterating hits calls for Washington to relax its
restrictions on high-tech exports to China.
Beijing complains that those high-tech restrictions, imposed
for security reasons, hold back purchases of U.S. goods that
could narrow the trade gap, a claim rejected by Washington.
Chen said Beijing is taking seriously U.S. concerns about
China's protection of intellectual property rights and its
government procurement policies.