Updated 14:08

CHINA HAS HINTED that it has begun to buy Portuguese government bonds, it is reported – suggesting that the world’s biggest emerging economy may be beginning to sweep up ownership of Irish debt.

The reports come after the country indicated its willingness to buy up Portuguese bonds, with its deputy foreign minister Fu Ying saying the country had “always given positive and favourable consideration” to buying bonds in countries where it was planning state visits.

That declaration came before last Thursday’s state visit from Fu to the struggling Iberian country – and was welcomed by the Portuguese government, with finance secretary Carlos Costa Pina declaring the Chinese interest as a vindication of a “strategy of diversifying our investor base.”

What’s more, the Financial Times reports that when Fu was joined by Chinese president Hu Jintao on Saturday for the latter two days of the visit, the topic of Chinese investment in the Portuguese state was high on the agenda.

“We’re willing to support, with concrete measures, the Portuguese impact of the current crisis,” Hu said, local media reported.

Last Monday, meanwhile, a Spanish news website quoted Hu as saying China was “willing to support the Portuguese efforts to reduce the impact of the crisis,” though there was no concrete proposal over the purchase of sovereign debt.

Last month, China said it had also invested in Greek bonds – a move that was similarly well-received in Athens as a vote of confidence in the Greek government’s measures to scale back its government spending.

China said on October 2nd it would buy further Greek bonds when Athens next issued new debt, and that declaration happened to coincide with the visit of the Chinese premier Wen Jiabao to Greece for two days at the start of the month.

China’s overtures to Portugal and Greece may be a sign of a broader national policy to invest in the bonds of struggling EU nations it believes could be the benefactors of international bailouts – meaning Ireland could potentially be a likely target for Chinese investment too.

Such suspicions could be further raised by the visit of Li Changchun, the Communist Party’s ‘Propaganda’ chief, to Ireland in late September, when the senior official discussed “economic issues and bilateral ties” with the Taoiseach, Brian Cowen.

Foreign affairs minister Micheal Martin also said in May that he hoped his own visit to China would result in more Chinese investment in the country.

An NTMA spokesperson told TheJournal.ie that it could not offer the identities of parties buying government bonds, as they were sold one to primary dealers who would then sell them secondhand.

The price of Irish government bonds has continued to rise this morning, standing at 8.831% as of 12:30pm, up from its upening price of 8.636%. The price had earlier peaked at 8.927%, sending the spread over similar German bonds to a record 622 basis points.