Domestic fund management should hold at least more than 51 percent stake in domestic fund management companies based on the rules made by the china Securities Regulatory Commission. As the survey, which interviewed 29 such foreign joint fund management firms in china, showed that the fully owned domestic funs firms, viewed as their greatest competitive threat, has ranked the second place in regards to threat perception in this year instead of the 16th position in 2007.

Alex Wong, a partner with PwC, said that because the expanding domestic fund management firms are a more stable and long-term development way to fund managers, domestic ones these days are winning the competitive edge over Foreign joint venture fund management firms.

He pointed out that it is because of the better career prospects in views of staff recruitment that fund management chose to work for foreign joint venture fund management companies before 2007. But nowadays, such advantages are less obvious since domestic fund firms are providing a more comprehensive product line-up and are more likely to get a new product launched and approved in China.

Nevertheless, the survey revealed significant growth by 2012 would been achieved by most foreign joint venture fund management firms in China, or about 66 percent of them their under their anticipation. This shows no evidence at this moment that the global financial crisis has lead to scale back or withdraw funds from China.

As the survey revealed that a “flat-to-moderate” growth is expected by foreign joint venture fund management firms from this year to the next three years.

Generally speaking, they hope to achieve a 101percent in the overall projected assets under management by 2012, in the hope of elevating the number of Chinese retail investors growing from the current 33.8 million to almost 69 million.

According to the survey, Fund managers at these joint venture asset Management firms also believe that the existing product performance should been improved and new products and distribution channels developed over the next three years if they want to increase profitability.

They predicted that qualified domestic institutional investors (QDII) would present a significant opportunity in the long term despite of their poor performance.

Robert Grome, an the senior partner with PwC said that mainland investors should have faiths in the QDII product , which is, conceptually, sound and will be very successful in providing profitable international market exposure.

According to the industry-wide data for the fourth quarter last year, 45.5 percent of the overall market share in views of assets is hold by the foreign joint venture fund management firms, achieving an AUM of 882 billion yuan. They had 224 funds under the management at the tail of 2008.

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Both Mountain Partners Group and the managing director of Navi Capital Yang Lei would give their efforts to establish the Taishan Angel Fund, the first-round capital of which would be ＄20 to ＄30 million.

This time the average amount to invest to single company would be about ＄500,000,  much lower comparing with $2-3 million before.

The global financial crisis made many capital investment companies change their plans from focusing on pre-IPO companies to start-up companies, said Cornelius Boersch, founder of Mountain Partners.

He said the Taishan Angel Fund would focus on the areas which were highly affected by the economic crisis, such as hi-technology, new media and telecommunications.

The invested companies will benefit a lot from the excellent services provided by this Fund. It would provide sufficient capital, advanced technologies and much more convenient channels to China market, Yang said.

Yang was once the CEO of Linktone, a NASDAQ-listed company. During 11 months of this position, he changed the fortune of this company and gained a great success.

He was the man who got the Linktone to be NASDAQ-listed company and made the valuation of the company increase 20 times.

The Moutain partners Group was established by Cornelius Boersch and Daniel S Wenzel in 2004.

Are you interested in the business opportunities in China?

China is one of the world’s great growth markets and is likely to be for many years to come. Foreign companies often face difficulties in assessing Chinese market demand and enacting effective strategies because of the language barriers, culture differences, and high expense.

BPOVIA is the leading virtual assistant and Knowledge process outsourcing (KPO) service provider in China. BPOVIA is the only virtual assistant company ever been nominated for the prestigious “Red Herring 100 Asia” Awards 2008. Combines international perspective with local know-how, BPOVIA can provide our clients China business development service and help our clients doing successful business in China.

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Beside this, according to CASME, other efforts include the joint issue of an SME corporate bond with the Liaoning provincial government and the founding of a bank with a planned registered capital of 10 billion yuan. The head of CASME said the bank will provide loans only to small- and medium-sized enterprises on the establishment of the fund. And for their development, they can get as much as 5 million yuan. But he didn’t mention when the bank will open. He also noted such fund will take effect on any industrial company with sales revenue up to 300 million yuan.

The major threat to SME’s survival is the difficulties raising capital. According to the National Development and Reform Committee, because of the economic downturn and a tight monetary policy, nearly 67,000 firms with sales income exceeding 5 million yuan shut down during the first half of this year. Shrinking loan supply from banks as well as rising costs should be the main causes to those closing down.

Li said it was obviously out of proportion when SMEs contributed 60 percent to China’s GDP but only got less than 25 percent of total bank loans. However, the country has searched the ways to help SMEs amid the financial crisis due to weakening demand at home and abroad as well.

The central bank raised loan quotas for national and regional commercial banks by 5 and 10 percent respectively in the second half of this year in order to help private firms ease their financial pressure. In addition, premier Wen Jiabao will put greater attention on challenges firms will face after he inspected them in Shanghai and Zhejiang province at the weekend.

He said: “More supporting policies should be available to create a sound environment for their development.”

Are you interested in the business opportunities in China?

China is one of the world’s great growth markets and is likely to be for many years to come. Foreign companies often face difficulties in assessing Chinese market demand and enacting effective strategies because of the language barriers, culture differences, and high expense.

BPOVIA is the leading virtual assistant and Knowledge process outsourcing (KPO) service provider in China. BPOVIA is the only virtual assistant company ever been nominated for the prestigious “Red Herring 100 Asia” Awards 2008. Combines international perspective with local know-how, BPOVIA can provide our clients China business development service and help our clients doing successful business in China.

Please visit http://www.BPOVIA.com/ for details about our service.