China Investment Corp, which manages the US$200 billion
sovereign wealth fund, won't find it easy to generate high enough
returns to meet its financing costs, General Manager Gao Xiqing
said yesterday.
The government yesterday sold 750 billion yuan (US$102 billion)
of 15-year bonds to the central bank as part of the 1.55 trillion
yuan it is seeking to raise to fund China Investment. The
securities carry a 4.45 percent coupon, compared with 4.66 percent
on similar-maturity debt sold last month, said Bloomberg
News.
"The returns on our national foreign currency reserves have
never reached this level before," Gao told a conference in Beijing.
"I'm not sure I can do much better than that. We feel big pressure
and it's not easy to be successful."
The sovereign wealth fund was started in September to help
diversify the world's largest foreign currency holdings. The fund
in May invested US$3 billion for a 9.4-percent stake in Blackstone
Group LP.
(Shanghai Daily December 12, 2007)
