By Rong Xiandong (chinadaily.com.cn)
Updated: 2007-07-24 15:51

The Chinese government is to release amended rules on management of insurance companies' overseas investment soon, allowing the nation's insurers to put more of their assets overseas to compensate for higher interest rates at home, the industry regulator said.

The China Insurance Regulatory Commission (CIRC) is working on the revised regulations together with other regulatory bodies and that the rules will be released soon, said the CIRC spokesman and assistant president Yuan Li at today's press conference.

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In 2006, the commission publicized draft rules under which domestic insurers are permitted to invest overseas using their own foreign currency or by buying other currencies.

The State Council allowed insurance companies to use their own foreign exchange (forex) for offshore investments in 2004 and gave the nod to their purchasing forex for investments in overseas markets in 2006, according to Yuan.

These measures have played an important role in promoting domestic insurance capital's investment abroad. As of June this year, domestic insurers had invested a total of 19.7 billion yuan in overseas markets.

China raised interest rates and cut the withholding tax on interest income on Friday in a coordinated move to get the blistering economy onto a healthier footing.