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China to boost Africa investment fund

BEIJING, Mar 17, 2009  – China will boost its state-run Africa investment fund by two billion dollars, so as to snap up opportunities left by Western investors leaving the continent, the Financial Times said on Tuesday.

Since its launch in 2006, the China-Africa Development Fund has invested about 400 million dollars in the continent, the paper quoted fund chief executive Chi Jianxin as saying in Johannesburg.

Most of the fund\’s initial capital of one billion dollars would likely be spent by the end of the year, up to two years ahead of schedule, Chi said.

"We are moving faster," he was quoted as saying, adding that African companies "need more money from us" because other investors had turned more reluctant.

Next year the fund plans to embark on a two-billion-dollar second phase of investments on its way to reaching a goal of five billion dollars, Chi said.

When establishing the fund, run by the government-run China Development Bank, fund managers said their goal was to offer investment to encourage more Chinese companies to do business in Africa.

Chinese President Hu Jintao announced the establishment of the fund at a 2006 China-Africa summit that ushered in a deepening of ties with the continent.

Some Western critics have accused China of worsening repression and human rights abuses in Africa through support of countries such as Sudan and Zimbabwe in a cynical drive to increase access to African oil and other resources needed to fuel its growth back home.

But observers have said the fund is focused on industries that would make it easier for Africa to develop, such as agriculture, electric power, road and water drainage systems.

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