The Wall Street Journal-20080131-Ex-Central Banker Helms China-s Social Security

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Ex-Central Banker Helms China's Social Security

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BEIJING -- China has appointed a former central-bank governor, Dai Xianglong, as chairman of the nation's social-security fund, the government said yesterday, as Beijing seeks to improve the fund's investment returns.

Mr. Dai served as China's central-bank governor from 1995 until 2003, when he became mayor of Tianjin. He is credited with helping the northern city near here develop into an important trading port and budding financial center.

In his new role as chairman of the National Council for Social Security Fund, Mr. Dai will be in charge of assets estimated at about 500 billion yuan, or nearly $70 billion, at the end of 2007.

The national social-security agency is a funding source from the central government to the network of locally administered pension systems around China. The national fund's activities are closely watched in financial markets because it is increasingly active in making investments -- and, for instance, is among the largest shareholders in state banks and other key government-controlled companies.

Mr. Dai's appointment by the State Council, China's cabinet, was posted on a government Web site yesterday. Mr. Dai left his post in Tianjin earlier this month.

The statement didn't say why Xiang Huaicheng, former head of the national fund, was replaced. Mr. Xiang has passed the normal retirement age of 65.

The social-security fund lost another top official last year, when Vice Chairman Gao Xiqing left to become vice chairman and president of China Investment Corp., the state company established to invest a $200 billion chunk of the country's foreign-exchange reserves.

-- Victoria Ruan