Recently, some Western politicians and media outlets have been suggesting that foreign investors are withdrawing funds from Chinese A-shares, indicating an acceleration of ‘decoupling’ with China. However, industry experts challenge these assertions, pointing to evidence of sustained and even increasing foreign investment in China.
In an exclusive interview with CGTN, Liu Yangsheng, founder of Impact Asia Innovation Capital and senior fellow at the Taihe Institute, shared his perspectives on this matter.
Question: Some Western media have recently used the routine business adjustments of global asset managers such as BlackRock and Norway’s sovereign wealth fund to speculate on the ‘withdrawal of foreign capital from China’s A-shares.’ What is your view on this?
Liu Yangsheng: I don’t think these murmurs need to be heeded at all. This is nothing new. From the book The Coming Collapse of China published more than 20 years ago to the present media narrative, Western hype has repeatedly been proven false. I believe there is a political force driving these claims.
Different investment banks have different strategies. Some may be shorting China’s stock market to buy it for themselves. As for ‘divestment from China,’ the United States may have reduced investments, but Europe has not. On the contrary, European foreign direct investment into China has increased substantially. For example, Germany’s FDI in China in the first half of this year almost reached a record level.
Additionally, I have observed Middle Eastern countries scaling up their investments in China, including the United Arab Emirates, Kuwait, Saudi Arabia, and Qatar. Many Saudi ministers have come to China in the past six months—eight ministers and a deputy minister—which would have been unimaginable a few years ago.
The Middle East is a center of wealth with abundant oil and gas reserves, but there’s limited capacity for large-scale industrial investments locally due to smaller populations. Investors continue to see risks in the U.S. market due to ongoing inflation and changing investment policies influenced by geopolitical considerations. With its vast population and increasing consumer spending, China offers a compelling opportunity for investors. I have spoken with several Saudi ministers who are very positive about investing in China.
Reference(s):
cgtn.com
