In 2006, newly raised venture capital totaled 24.085 billion yuan, up 23.06 percent from 2005, of which 65.1 percent was overseas venture capital. Thanks to the increasing overseas venture capital in China, its proportion in the total venture capital went up by a large margin from 5 percent in 2003 to 33.9 percent in 2005, and 43.7 percent in 2006.

By sector, traditional industries absorbed 2.057 billion yuan in 2006, taking up 14.3 percent, while the venture capital in IT industry stood at 6.3 billion yuan or 43.88 percent of the 14.364 billion yuan net VC investment in 2006.

By region, Beijing and Shanghai are the two leading destinations for venture capital. By the end of 2006, venture capital in Beijing accounted for 45.5 percent of the national total, as against 15 percent, 23 percent and 33 percent in 2003, 2004 and 2005 respectively.

Venture capital in Shanghai took up 15.6 percent of the national total.

Despite the record high scale of venture capital in China, the report pointed out that most investment projects belonged to expansion projects, but the number of new projects didn’t reverse the falling trend. Financing for new projects is inadequate. (Edited by Chen Dongyi, )