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The Canadian Press - ONLINE EDITION
Canaccord partners with Chinese bank on $1B fund to promote resource investment
The corporate logo for Canaccord Financial Inc. (TSX:CF) is shown. THE CANADIAN PRESS/HO
TORONTO - Canadian merchant bank Canaccord Financial Inc. (TSX:CF) says it will partner with the Import Export Bank of China to raise a US$1-billion fund promoting Chinese investment in natural resources around the world.
China has become a big player in Canadian natural resources, with several major recent investments, mostly in oilsands development. The world's most populous country has been looking to bolster future supplies of energy, minerals and metals, and nutrients such as potash — all of which Canada has in abundance.
Vancouver-based Canaccord said Thursday it has signed a memorandum of understanding — in front of Prime Minister Steven Harper and Chinese Vice-Premier Li Keqiang — with the Chinese bank known as Eximbank to create the fund, which will be called the Canada-China Natural Resource Fund.
It will be designed to invest in public and private natural resource and energy projects in Canada, as well as companies operating elsewhere that are listed — or could be listed — on Canadian stock exchanges.
"Canaccord's deep knowledge of the resource sector and Canada's strong natural resource industry will be highly complementary to the interests of investors and the continued demand for energy and other resources," Canaccord president and CEO Paul Reynolds said in a statement.
"The Canada-China Natural Resource Fund demonstrates the importance of Canadian financial markets in the development of resource companies and the continued expansion of Chinese participation in natural resource projects around the world."
The fund will be run by an independent management team, with a first closing is planned within the first half of 2012.
Harper has been touring China this week and earlier Thursday the two countries released a joint statement committing to complete an joint economic study by May. That could paves the way to move the economic relationship to the next level, possibly including free trade talks.
The Harper government has placed a premium on signing free trade deals, launching and concluding negotiations with several countries over the last six years.
A Canadian Press-Harris Decima survey released Thursday, found 51 per cent of Canadians polled welcomed Chinese investment when it helps fuel business that otherwise wouldn't get off the ground.
But the poll suggested Canadians are less enthused about the Chinese having a controlling stake in Canadian-owned or operated companies.
Harper highlighted 22 commercial agreements officially signed during his stop in Beijing, saying they are worth $3 billion to the two economies.
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