Barclays has agreed to sell significant stakes of itself to investment arms of the Chinese and Singapore governments.  The investments have now enabled the British bank to raise its bid for ABN Amro of the Netherlands.

China Development Bank will initially invest 2.2 billion euros, for a 3.1 percent stake, while agreeing to put in an additional 7.6 billion euros if the takeover succeeds. That would increase its stake to 8 percent in a merged Barclays-ABN Amro bank.

Temasek, an investment firm controlled by the Singapore government, will invest 1.4 billion euros, for a 2.1 percent stake. Its stake would rise to more than 3 percent with an additional 2.2-billion-euro investment if Barclays is successful. Temasek has stakes in a number of financial institutions, including Standard Chartered of Britain.

Barclays is now offering 67.5 billion euros, or $93 billion, up from 65 billion euros, and now consisting of 24.8 billion euros in cash.

That is still below a rival $98 billion offer from a group of banks led by the Royal Bank of Scotland. Nearly all of the rival offer is in cash.

The Chinese investment in Barclays is a further sign of Beijing's desire to put some of its huge foreign-exchange reserves to work in more ambitious investments than just United States Treasury securities. The Barclays investment comes two months after the Chinese government announced plans to invest $3 billion in the private equity giant Blackstone Group. China appears to want to emulate Temasek, which has been an aggressive investor. (Perhaps not surprising, Blackstone advised China Development Bank on the Barclays investment.)

"This strategic and financial collaboration is the next step in the evolution of China Development Bank into a commercially operated financial institution," the governor of the bank, Chen Yuan said in a statement.

 Bob Diamond ,the president of Barclays, said that the bank had approached China Development Bank, with which Barclays has had a long relationship, and Teamasek in May.  

The Financial Times' Alphaville blog says that the Chinese and Singapore investments are a sign that finance is not immune to the effects of globalization.

Referring to Thomas Friedman's The World Is Flat, Alphaville says that "Western banks are now getting the 'flat' treatment, with the components of what promises to be the biggest banking merger on the planet now being put together in all corners of the globe."