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China's social security fund will be injected step by step into the capital market so as to preserve and augment its value, said Liu Yongfu, vice-minister of Labor and Social Security, Monday at a three-day seminar on social security fund supervising.
China's social security fund can be divided into several parts. The first part has been raised by the state as a whole and retains its main task to ensure current payment. It has no surplus money for the capital market.
The second part has been raised by the central government and has attempted to operate in a market-oriented style. Forty percent of it can be expected to enter into the stock market, while the enterprise debt and national debt markets absorb some of the fund.
The third part includes individual account funds and about 20 billion yuan (about US$2.4 billion) in annuity funds of enterprises, which can be put into the capital market next, according to Liu.
In recent years, China's social security funds have been at a surplus.
Statistics showed that total income and expenses of the fund has reached 730 billion yuan (about US$85.5 billion) with a surplus of 300 billion (US$36.1 billion) in 2002.
(Xinhua News Agency January 21, 2003)
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