China’s sovereign wealth funds are in a position the entire world should envy. In spite of the crisis they still have hundreds of billions of dollars in highly liquid assets and, unlike the plethora of institutions that are treading water, they are looking for opportunities amid the wreckage. There are plenty around.
This could be the year in which the Chinese funds truly flex their muscles and make some important acquisitions abroad. However, it is just as likely that they will carry on with their staid, conservative strategies.
The two funds that have seen the most significant activity for foreign fund managers are the $200bn (£128bn) China Investment Corporation and the $88bn National Social Security Fund. Managers who have worked with the SWFs expect the CIC and NSSF will continue on a trend of gradual diversification.