“At this time of turmoil and transition in an evolving world, we earnestly call on all parties to practice genuine multilateralism, to safeguard and promote economic globalisation, to facilitate the free, open, and orderly flow of international capital and investment, and to join hands to maintain stability in the international economic and financial system and drive the steady recovery and sustainable development of the world economy.”

China’s economic tsar sends rare message, warnings to future policymakers

The Beijing-based fund, which was set up in 2007, has positioned itself as a long-term financial investor that strives for cooperation, while it does not seek control of the companies in its portfolio.

Its overseas investments registered a net return of 14.27 per cent in US dollar terms last year, compared to 14.07 per cent a year earlier.

The annualised cumulative 10-year net return reached 8.73 per cent, beating its 10-year performance target by 296 basis points.

The fund remains heavily exposed to advanced markets, despite China’s elevated trade tension with the United States, Australia and Canada.

Capital-outflow concerns keep Beijing on guard against external shocks

Some 61.5 per cent of its public equity holdings last year were from the US, with another 25.4 per cent from other developed markets, while around 51.3 per cent of its fixed-income holdings are sovereign bonds from advanced economies.

As a flagship for China’s overseas investment, the asset allocation of the US$1.35 trillion sovereign wealth fund is closely watched by market professionals, especially after markets turned volatile amid the US Federal Reserve’s monetary tightening to curb decades-high inflation.

The fund slashed its holding of public equity by 2.6 percentage points last year to 35.4 per cent, while also lowering its holding of fixed income equity to 15.4 per cent from 17 per cent, the annual report showed.

CIC, though, raised the proportion of its alternative assets to 47 per cent from 43 per cent.

No 1 priority for China is still GDP growth, senior economic official asserts

Domestically, subsidiary Central Huijin Investment, which has a controlling stake in China’s Big Four state-owned banks, China Development Bank, an export insurance agency and some leading securities brokerages, played an “instrumental role” as a platform to resolve financial risk and maintain market stability, the annual report added.

Central Huijin Investment helped bail out the distressed Hengfeng Bank in 2020 and now holds a 53.95 per cent stake in the joint-stock commercial bank.

“In our management of state-owned financial capital, we stepped up risk monitoring of Central Huijin’s portfolio companies, guided them to carry out risk checks in key areas, and proactively addressed and resolved existing risks to achieve stable and healthy development,” the annual report said.