China's Hangzhou city plans to set up a 5 billion yuan ($730 million) fund to invest in industrial projects and a 560 million yuan venture capital fund to support high-tech and Internet startups, its mayor said on Wednesday.

Hangzhou Mayor Cai Qi said 5 billion yuan was the target for the initial phase of the Qian Jiang Industrial Fund, adding that the government of the eastern Chinese city would continue to raise funds after completing the first phase.

The city has been in touch with more than 20 private equity houses that may become partners in the industrial fund, he added.

The Hangzhou government will also set up a 560 million yuan venture capital fund to support high-tech and Internet companies, he said, aiming to build up companies that could emulate the success of Alibaba.com Ltd, which is based in Hangzhou and is China's largest e-commerce firm. "Hangzhou wants to be a haven for venture capital and private equity funds, and we are looking for the second and third Alibabas," he told an industry forum. ($1=6.857 Yuan)

Source:Reuters