A Change of Guard

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Sunday, 12 April 2009

China planned $10 billion invest fund at failed summit

Chinese Premier Wen Jiabao (C) walks before departing from U-Tapao military airport in Sattahip April 11, 2009. China's economy is in a better shape than expected with March industrial output growth exceeding forecasts, but it still faces big challenges, Wen said on Saturday.

BEIJING (Reuters) - China had planned to announce a $10 billion (6.8 billion pound) infrastructure investment fund and offer credit to neighbours at a cancelled weekend summit of Asian leaders in Thailand, its foreign minister said.

Anti-government protesters forced the cancellation of the summit in Pattaya after they swarmed into the summit venue.

In an interview with state media on a flight back to China, Foreign minister Yang Jiechi avoided direct criticism of the Thai government while detailing measures that Chinese premier Wen Jiabao had planned to offer at the summit.

China plans to establish a $10 billion China-ASEAN investment cooperation fund to promote infrastructure that connects it to ASEAN nations, Yang said.

China has been active in building roads from its southern border through neighbouring Myanmar, Laos, and Vietnam, to ease trade.

It will also offer a credit of $15 billion to ASEAN countries, including preferential loans of $1.7 billion for cooperation projects, Yang said.

It plans to offer 270 million yuan ($39.51 million) in aid to Cambodia, Laos and Myanmar to help those impoverished countries combat the global financial crisis, and will inject $50 million into the China-ASEAN cooperation fund, Yang said.

While not an ASEAN member, China's growing economic clout, huge market and competitive exports make it an important participant in ASEAN summits, although tensions persist over competing claims to the South China Sea and Chinese plans for dams that are opposed by other nations along the Mekong river.

China recently appointed its first ambassador to ASEAN, after the 10-member grouping formally adopted a charter.

($1=6.833 Yuan)

(Reporting by Lucy Hornby; Editing by David Fox)

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