China issues government investment fund evaluation rules

BEIJING, Jan. 12 (Xinhua) -- China's top economic planner on Monday released a trial regulation aimed at improving the evaluation and management of government investment fund allocations.

The move aims to better leverage these funds to serve national strategies, promote industrial upgrading, and foster innovation and entrepreneurship.

Issued by the National Development and Reform Commission (NDRC), the regulation highlights the role of allocation evaluations in guiding government investment funds to align with national industrial policies and support the development of a modern industrial system.

It also calls for stronger coordination between national-level funds and local government funds to support major national strategies, key sectors and weak areas where market forces fall short.

The regulation sets out evaluation criteria that focus on the funds' performance in supporting national strategies, such as fostering new quality productive forces, promoting technological innovation and commercialization of research outcomes, providing patient capital, and enhancing public well-being.

Additional indicators assess alignment with the country's regional strategies, priority investment areas and efficient capacity utilization, as well as policy implementation.

The NDRC said final evaluation results will be communicated to provincial-level governments, relevant departments, evaluated entities and relevant financial institutions. The results will be released through a registration system.

On Monday, the NDRC and three other government departments also released a document to guide the planning and allocation of government investment funds, requiring the funds to focus on early-stage investments in startups and small enterprises, long-term commitments, and hard technology.

The document explicitly prohibits government investment funds from a series of investment activities, such as increasing local government debt through disguised means, engaging in publicly traded equity investments except for certain circumstances or engaging in futures or other derivative transactions, and providing guarantees for enterprises or projects.

Liu Guoyan, a researcher at the Chinese Academy of Macroeconomic Research, said that the two documents together standardized the whole process of management of the government investment funds, and are expected to improve the efficiency of fiscal fund utilization, optimize the country's capital supply structure and promote the standardized and healthy development of the fund industry. ■