Last week The New York Times reported on the emergence of a small group of “Matchmaker” investment agencies, which connect businesses in need of capital to Chinese investors with excess cash.
The Times cited a prediction by private equity fund A Capital, that “Chinese outbound investment will equal inward investment within the next three years.” For a country with disproportionately high levels of investment, we’re talking about a lot of excess cash. But how will foreign investors cull it?
One solution is a company called ChinaGoAbroad, one of two profiled by the Times, that links investors — particularly state-owned enterprises, private companies, and high net worth individuals — to a variety of industries across the globe. Investment opportunities include a chemical plant in Canada, real estate in Spain, as well as a number of domestic Chinese projects.
Last month, the Times quoted China’s commerce minister as saying, “With foreign reserves of $3 trillion in hand, we will not sit back and watch the assets depreciate with the third round of quantitative easing. We must inject it into the real economy and make our contribution to global prosperity.” Matchmaker agencies look well positioned to direct traffic.