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BEIJING, Jan 4 (Reuters) - Shaanxi is set to be one of the first Chinese provinces to participate in a pension investment scheme that allows them to invest in financial markets for the first time, Shaanxi Daily, a newspaper in the northwestern province, reported on Wednesday.
With many provinces under severe pressure to meet pension repayments, Beijing has promised to push forward an investment plan for idle local pension funds, holding an estimated $290 billion, that will seek higher returns through alternative investment channels for higher returns.
Shaanxi was among six Chinese provinces that had an annual pension deficit in 2015, with funds estimated to be only sufficient for repayments for up to 10 months, a report by the Ministry of Human Resources and Social Security showed.
In August last year China said it would, for the first time, allow pension funds, whose investments has hitherto been limited to low-yielding bank deposits and treasuries, to invest in stocks and other assets.
Since then, China has selected four banks as custodians of its pension insurance fund, and 21 investment management institutions for the fund.
In an announcement on Dec. 29, the National Council for Social Security Fund said it had received written confirmation from the first batch of provincial governments that had opted to participate in the new investment plan.
Reporting by Yawen Chen and Kevin Yao; Editing by Simon Cameron-Moore