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CIC Chief Hopes to Cut Treasury Purchases

Published Tuesday, 15th January 2013 09:53 am - © 2013 Dow Jones

China's sovereign wealth fund hopes to reduce its reliance on purchases of U.S. Treasurys and boost investments in other assets as the U.S. economic recovery makes U.S. government debt less attractive, the Shanghai Securities News reported Tuesday, citing the fund's head.

The report cited China Investment Corp. Chairman Lou Jiwei as telling a conference in Hong Kong that the fund would like to add more stocks to its portfolio.

He didn't provide a definite time frame for any investment shift, merely saying that over the long run the attractiveness of U.S. debt would diminish.

CIC has focused its investments on assets in the U.S. and developing nations and has underweighted assets in Europe, Mr. Lou added.

CIC was formed in 2007 to improve returns on China's swelling foreign-exchange reserves, which had mainly been invested in U.S. Treasury debt and other low-yield investments. China's foreign-exchange reserves stood at $3.31 trillion at the end of last year.

The fund reported a 4.3% loss on its overseas investments in 2011 as its holdings, including energy and resource producers, were hit by volatile global markets.

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