1、SovereignWealthFundsCChinaWall Street was thrown a lifeline recently from an unexpected quarter, just when accumulating sub-prime losses andconcerns about credit were threatening it.In December last year Chinas largest state-controlled investment vehicle, the newly created China Sovereign Wealth Fun
2、ds Chinas Arms-Length ApproachThe Mainlands sovereign wealth funds will continue to expand, reports Don Gasper. But far from being a threat to other economies, this is a golden opportunity for overseas asset managers.Investment Corporation (CIC, paid US$5 billion for a 9.9% stake in US bank Morgan S
3、tanley after the latter posted a larger than expected loss in the fiscal fourth quarter.In January similar sovereign wealth funds (SWFs from other countries stepped in with a combinedPhoto by: Sophia TsibikakiUS$21.1 billion to bail out the largest bank in the USA, Citigroup, and the largest brokera
4、ge in the world, Merrill Lynch, after both also reported heavy fourth-quarter losses.Former US secretary of the treasury Lawrence Summers said in Davos that month that SWFs needed to become more transparent and he expressed his fear that such funds might be in a position to exert undue political pre
5、ssure on their hosts.Others, however, say that SWFs are no different from other investors and simply want to find the best return for their investment.“Most of these SWFs are just like pension funds,” says Bank Sarassins chief investment officer, Burkhard Varnholt. “It has been a great blessing to t
6、he world economy that they have been around in the last few months.”Chinas SWFs are indeed explicitly intended to fund the countrys future pension liabilities and strengthen its banks as well as to diversify its foreign exchange holdings.“CICs purpose is to achieve reasonable, long-term returns and
7、also to improve the corporate governance of domestic banks, CIC Chairman Lou Jiwei told a conference in Beijing last November.“CIC w ants t o b e a s tabilising f orce i n t he i nternational capital markets, Lou said, adding that the funds focus would be on traded securities in international market
8、s with only a small part in “alternative” investments.Rapid Increase in Scale of Chinese FundsGeorge Hongchoy, managing director of DBS Asia Capital Ltd, anticipates a rapid increase in the scale of Chinas SWFs, saying that the country could increase the size of CIC to over US$1 trillion if it makes
9、 available more of its steadily expanding foreign exchange reserves.Towards the end of last year Chinas policy makers decided to allow the renminbi rise against the US dollar more quickly than many had expected. At roughly the same time, in September, they elected to create a new agency, CIC, modell
10、ed on Singapores Temasek Holdings and the Government of Singapore Investment Corporation (GIC, to diversify the countrys foreign exchange reserves.The CIC was created in response to the challenge that a US$1.6 trillion plus sterilised foreign exchange surplus was losing money every day, due to the d
11、ecline of the US dollar. Given the near certainty of renminbi appreciation over the next two years, China could no longer afford to leave its foreign currency reserves in low-yielding instruments.But the State Administration of Foreign Exchange could have done the job. There was also Central Huijin
12、Investment, a state-sponsored bank reconstruction agency. So why create a new body?“In our view, there are two reasons,” argues a new report issued in Shanghai in April on the funding, asset growth, strategies and preferences of Chinas SWFs. The report was put out by Z-Ben Advisors Ltd, a company pr
13、oviding in-depth research reports and consultancy services on Chinas investment and fund industry to foreign financial institutions and third-party providers.“First, by having CIC assume responsibility over Central Huijin Investment, the government gave CIC a unity of purpose domestically and intern
14、ationally: Make money by being a passive, minority investor (not the asset-gobbling monster it has errantly - been made out to be.“Second, CIC could achieve levels of transparency in its investment, reporting and strategy that, for a government agency, would either have been impossible or simply not
15、 believed by outsiders.”Western countries are paying high attention to CICs actions, given Chinas growing economic and political influence, Hongchoy says. Considering lessons learned from other SWFs, CIC tends to be more cautious about making overseas investments.“There have been concerns voiced, pa
16、rticularly in the USA, over the lack of transparency of SWFs and over their agenda being allegedly set by politics rather than economic motives. Another criticism has been that they make judgments on the basis of short-term results for what are long-term investments. Finally, there has been concern
17、as to when they dispose of their holdings, especially if there are significant capital gains.”So far, he notes, given the existence of tremendous investment opportunities in China itself, CIC has been making a vast amount of investments domestically, a pattern that differs from SWFs in other countri
18、es.More Overseas Investment Likely But At Arms LengthHowever, following its injection of US$ 67 billion into the Agricultural Bank of China and the China Development Bank, CIC has essentially run out of domestic assets capable of soaking up the large sums it is entrusted with. More overseas investme
19、nt is therefore probable, but China is likely to do this in a way that avoids the headlines.Hongchoy thinks that it is likely to follow the model set by Norways Global Pension Fund, whereby external managers are used, shielding SWFs from protectionist measures and accusations of market manipulation.
20、 “We believe CIC will likely outsource some of its funds to overseas asset managers for portfolio investment in equities,” he says.It will continue also to make investments in private equity houses, like Blackstone Group, through which it can invest in a wide range of businesses indirectly. CIC made
21、 headlines in June last year when it paid US$3 billion for a 9.9% stake in Blackstone. However it took no seat on its board.The Z-Ben Advisors report takes a similar view. China “will now strongly prefer, unless compelling bargains are offered in countries which welcome Chinese investment, to put it
22、s money to work at arms length: specifically, through third-party mandates,” it argues, forecasting a substantial increase in the volume of assets that Chinese SWFs will place in the hands of third-party asset managers by 2010.By that year, it says, the countrys SWFs, as a group, will be the worlds
23、third-largest users of third-party mandate managers, behind only Japans National Pension Fund (US$740 billion in external mandates and the Abu Dhabi Investment Council (US$680 billion in external mandates in total assets invested.Over US$320 billion in new assets will be allocated by the end of that
24、 year to foreign third-party mandate managers by Chinas SWFs, including the major ones CIC, the National Council for Social Security Fund (NCSSF and the China-Africa Development Fund (CADFund, the report predicts.In what is perhaps its most surprising prediction, the report says that CICs assets und
25、er management (AUM will rise from US$200 billion at present to US$625 billion by the end of 2010. More than 70% of the new funds are projected to be assigned to more than 100 third-party foreign managers.NCSSFs AUM are expected to grow from US$72 billion now to US$104 billion by the same time. Over
26、40% of those new funds are predicted to be allocated to third-party foreign managers.Chinas S WFs w ill s pend t he n ext 30 m onths fi nishing the seeding phase of their long-term investments, says the report: More than 120 new mandate managers will be selected by the end of 2010 with mandates rang
27、ing from US$0.5 billion to US$6.0 billion.Regarding exposure to foreign securities, the report says that Chinas SWFs intend to increase dramatically their exposure to foreign securities, from less than 14% of current assets to more than 49% by the end of 2010.“China not only needs to diversify its f
28、oreign exchange reserves and fund its future pension liabilities through investment, it needs to accomplish these tasks at some speed,” says Peter Alexander, Z-Ben Advisors Principal. “Investing directly in global companies is only a small part of their overall strategy: The largest proportion of th
29、eir funds will be invested with professional asset managers.“Asset management companies need to be aware of the speed at which these mandates will be assigned in the next 30 months than are likely to be granted in the subsequent five years. Chinese SWFs intend to put their near-term seed money in to
30、tal, more than US$630 billion by end-2010 to work and their unambiguous preference will be for managers who are prepared to work quickly.”So for those interested, nows the time to apply!主權財富基金中國採取中庸之道內地主權財富基金的規模將繼續擴大。但它們非但不會構成對其他經濟體的威脅,而且還是境外資產管理機構的黃金機遇。Don Gasper報導。最近,正當華爾街面臨日益嚴重的次按損失及 信貸威脅時,從一個意想不
31、到角落拋來了救生圈。美國摩根士丹利銀行宣佈去年第四季的虧損超過預期後,於去年12月,中國最大的國家控股投資機構,即新成立的中國投資有限責任公司(中投以50億美元,購買美國摩根士丹利銀行9.9%的股權。今年一月,其他國家的類似主權財富基金亦施以援手,總共支付211億美元挽救美國最大的銀行花旗集團以及世界最大的券商美林證券。此前,兩者亦公佈第四季度遭受巨虧。前任美國財政部長Lawrence Summers在一月在達沃斯表示,主權財富基金必須變得更加透明。他表示自己擔心此類基金有可能對東道國施加不恰當的政治壓力。但是也有人表示,主權財富基金與其他投資機構並無差別,只是希望為自己的投資尋找最佳回報。這
32、些主權財富基金中的大多數就像退休基金那樣。 Bank Sarassin的投資總監Burkhard Varnholt說道:過去幾個月來,它們的存在令世界經濟受益匪淺。確實,中國主權財富基金的明確意圖便是為該國未來的養老責任提供資金,強化內地銀行,並且令其外匯資產更加多元化。去年11月在北京的一次研討會中,中投的主席樓繼偉表示,中投的目的在於實現合理、長期的回報,並改善國內銀行的公司管治。他說:中投希望成為國際資本市場的穩定性力量。樓繼偉補充說,中國主權財富基金的投資重點將是國際市場中的流通證券,僅有一小部分進入另類投資。中國基金規模迅速擴大據星展亞洲融資有限公司執行董事王國龍預計,中國主權財富基金的規模將迅速擴大。他指出,如果中國將不斷增長的外匯儲備更多注入其中,便可以將中投的規模擴大至超過一萬億美元。臨近去年年底,中國的政策制定機構決定允許人民幣以超過許多人預期的幅度對美元升值。差不多同時(九月份,它們決定仿照新加坡的淡馬錫控股及新加坡政府投資公司模式設立新的機構(中投,使得中國的外匯儲備多元化。由於美元貶值,超過16,000億美元的淨外匯盈餘正在日益縮水。成立中投正是為了應對這樣的挑戰。由於人民幣在今後兩年中升值幾成定局,中國再也不能將其外匯
