updated 6/13/2005 9:53:39 PM ET 2005-06-14T01:53:39

In an effort to spur the high-tech industry in the world's largest emerging market, Intel Corp. has established a $200 million venture capital fund to invest in Chinese companies developing new hardware, software and services.

Intel Capital, the investment arm of the world's largest chip maker, announced the fund Monday, a day before the start of a conference that attempts to connect executives of its portfolio companies with decision makers from corporations and governments.

In a sign of China's emerging importance in the technology industry, Intel Capital's CEO Summit is being held for the first time outside the United States. The conference runs through Thursday in Beijing.

Initially, the fund will be used to invest in companies developing new hardware, software and services related to cellular communications, broadband applications for consumers.

"Companies around the world should look beyond China's purchasing power and view the country's innovators as potential suppliers," said Intel Capital President Arvind Sodhani. "We look forward to working together with the country's leading technology companies to grow China's IT industry together."

Intel has had a presence in China for 20 years, and Intel Capital first invested there in 1998. Since then, it has invested in nearly 50 Chinese companies in mainland China and Hong Kong. Eleven of those have since gone public or have been acquired, Intel said.

Since its inception in the early 1990s, Intel Capital has invested more than $4 billion worldwide in 1,000 companies, representing more than 30 countries.

As of April 2, the Intel Capital portfolio was valued at about $1.1 billion. Of its 2004 investments of more than $130 million, about 40 percent were in companies outside the United States. Of those, half were in Asia and the remainder in Europe, Israel and Latin America.

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