Research On Government's Role In The Development Of China's Industrial Investment Fund

Research on Industrial Investment Fund (IIF) started from 1990s in China. But because of some divergence and dispute, IIF did not develop truly. Bohai Industrial Investment Fund that is the first IIF which capital is all from Chinese organizations is authorized in December, 2005; this indicates the good time for the development of China's IIF is coming. On December 30th, 2006, Bohai Industrial Investment Fund established officially in Tianjin. On September, 2007, State Council authorized the second group of IIF.This thesis is to deep research the role that government should play in the development of China's IIF and suitable ways of the role. The thesis uses some research methods, such as theory connecting practice, comparison research and standard analysis combining data verification, and thus establishes a whole research system, expresses opinions clearly.The thesis can be divided into three parts logically:The first part gives the definition of IIF, expounds its special features, operational process and relation to Venture Capital Fund (VC), analyzes the significance of developing IIF and the actuality of IIF in China, and thus describes the general situation of IIF.The second part based on economics that government involves in the operation of market, expounds the reason and necessity of government affecting to IIF in theory; and then introduces the role of foreign government in developing Investment Fund objectively and in detail, quotes its actual experience.The third part is on the basis of theory study and foreign practice analysis, and combines actual national condition of China, thus concludes the role of government in the development of China's IIF and suitable ways of the role.Research conclusions of the thesis: The development of China's IIF needs government's guidance, encouragement and support, but government should not intervene too much. The central role of government is to produce a good external environment; and government should also provide some money as shareholder at the proper time, at the initial stage of China's IIF, government should offer some capital as stockholder, but along with the development of IIF, organization investors should become main investors and social capital should gradually increase; and then government should give finance subsidy that is one type of money pouring to inspire the investment of IIF, but government purchase as a method of economic encouragement should extend different treatment to different kinds of IIF; furthermore, preferential loan and credit guarantee that are also ways of economic support should be used carefully.