British Columbia’s public pension manager has paused direct investments in China, the latest institutional investor to rethink its exposure to the world’s second-largest economy due to geopolitical risks, reports Bloomberg. A senior executive from British Columbia Investment Management Corp. revealed the policy during testimony this week to a Canadian parliamentary committee. Ontario Teachers’ Pension Plan has made a similar move, suspending new investments in private assets in China, Bloomberg reported in January.
BCI still has Chinese investments, mostly through public markets and index funds, amounting to less than 5% of its holdings, the fund said in an emailed statement. “Across our portfolio, BCI has reduced its exposure in China and Hong Kong by approximately 15% over the past two years, including pausing direct investments in China,” it said. BCI had C$211 billion ($158 billion) in net assets under management at the end of March 2022.
The firm, which invests on behalf of public-sector pension plans and insurance funds in Canada’s third-largest province, said its remaining exposure to China is part of a broad diversification strategy that includes emerging markets.