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Aviva, the UK’s largest insurer, will announce today that it has won approval to establish a branch of its Chinese life assurance joint venture in the city of Changsha.
The branch, in the capital city of Hunan province, in south central China, will bring to 13 the total number of cities in which the Aviva-Cofco joint venture has
Aviva-Cofco is a joint venture with China National Cereals, Oils and Foodstuffs Import and Export Corporation, one of China’s largest state-owned enterprises.
The move underlines Aviva’s determination to grow in Asia.
Two years ago Richard Harvey, chief executive of Aviva, admitted that the group lagged a number of its rivals in the region.
Aviva will also be keen to prove that it can expand its operations around the world after a failed £17bn approach to Prudential earlier this year raised doubts about its organic growth prospects. Last week Aviva agreed to acquire AmerUs, a US life assurer, for about £2bn including debt.
The latest approval in China means Aviva has branches in six cities and a further seven sub-branches. It takes the group closer to its long-term goal of achieving an average 10 per market share in 10 provinces or municipal cities by 2010. Aviva refers to this as its “10 by 10 by 10 strategy”.
Changsha, with a population of 5.7m, is the financial centre of Hunan province. It is ranked 19th among China’s top 50 cities in terms of economic strength.
The province of Hunan has a population of 65.6m people. In 2005 Hunan’s gross domestic product was Rmb647.4bn (£43.6bn) and its growth was 11.6 per cent, compared with the national level of 9.9 per cent in the same year.
As well as its operation in China, Aviva has long-term savings businesses in Singapore, India and Hong Kong. It is also eyeing the Taiwanese market.
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