Lim said China is up against a challenge as it seeks to adopt a new economic model to continue generating good growth and jobs. — Bloomberg
SINGAPORE: Singapore sovereign wealth fund GIC Pte is “doubling down” on some sectors in China as it remains investable, even if it has become hard to make top-down allocations, according to its chief executive officer (CEO).
China is leading the world in certain industries like green technology, GIC’s CEO Lim Chow Kiat said on a panel at the 10th Milken Institute Asia Summit in Singapore. Consumption will play a bigger role in the nation over the long term and could present opportunities, he added.
Doubts over the investability of Chinese assets have gathered steam this year as Beijing’s efforts to restore investor confidence have had limited impact in face of a slowdown, and as the United States steps up oversight of its exposure to Asia’s largest economy.
Lim’s comment reflected how Chinese investment opportunities have possibly started shrinking for global sovereign wealth funds after years-long regulatory crackdowns and Covid measures.
China is up against a challenge as it seeks to adopt a new economic model to continue generating good growth and jobs, Lim said.
“It’s difficult to make top-down allocations because the situation is very complex,” making it tough to invest based solely on themes, he said.
Hedge fund Two Sigma Investments LP’s Asia Pacific CEO Kenny Lam also struck a bullish tone on China in an interview with Bloomberg Television.
He said the New York-based firm remained committed to the Chinese market over the long term, adding that building up onshore research and data teams is a key priority.
Separately, GIC’s Lim added the US Federal Reserve may not ease policy next year as it needs to be very sure that there’s no rebound in inflation and its credibility is at stake.
GIC in July reported its worst five-year returns since 2016, citing the slowing global economy as a main cause as it warned the consequences of rising interest rates have yet to fully play out. — Bloomberg
