Expert: Emerging markets have more opportunities

Lou Jiwei, the board chairman of China Investment Corporation (CIC), recently wrote an article saying that in recent years, the return on equity (ROE) in China's emerging markets has exceeded that in the emerging markets of foreign countries, and CIC will continue to track the development of the global economic situation and steadily accelerate its investment progress in foreign countries.

Lou also expressed that the low deposit, the deficit in the current account of international payment balance and the fragile financial system were main characteristics of economic entities with emerging markets 20 years ago. However, some countries with emerging markets had successfully overcome the impact of the financial crisis, and their rapid economic growth had stabilized the global economy.

He believes that so far, the worst period for the global economy has passed, but it still needs a period of time to return to its normal condition. Although emerging markets can play an important role in buffering the impact caused by a financial crisis, they will not be able to become a locomotive to drive the global economy to rapidly grow during the post-financial crisis period.

Lou expresses that in 2010, CIC will continue adjusting and improving its strategies and mechanisms on tactical asset allocation, rebalance of assets, investment superposition and other aspects, and form a research-driven investment style with reasonable allocation. Meanwhile, it will continue tracking the development of the global economic situation, actively arrange its investments in investment products, enterprises and industries and steadily accelerate its investment progress in foreign countries to realize better returns on investment.

The investment made by CIC since the second half of 2009 has mainly focused on resources and commodities. Lou explained that firstly, investment opportunities have appeared following the impact of the international financial crisis. Secondly, commodities can effectively help resist inflation risks as hedge tools. In addition, the global economic recovery will lead to a considerable increase in the value of resources and commodity assets.

According to a document recently issued by the U.S. Securities and Exchange Commission (SEC), CIC held 9.63 billion U.S. dollars worth of equity holdings in U.S. listed companies in consumer product, retail, high-tech, telecom and pharmaceutical industries at the end of 2009.

By People's Daily Online