CIC 2.0 Takes Shape

Ashby Monk

Proposals to create a new Chinese SWF appear to be making progress:

“A draft proposal to establish the new firm, which is expected to have at least 50 billion yuan ($7.3 billion) of initial registered capital and to be directly led by SASAC, was recently submitted to the State Council, China’s cabinet, for approval, said the sources.”

As I mentioned in a previous post, the new SWF–which is being called CIC 2.0–will be an amalgamation of several under-performing SOEs and managed by the State Owned Assets Supervision and Administration Commission. The difference between this entity and the CIC would be its domestic focus, making it more akin to the Central Huijin Investment Company (a CIC subsidiary).

It also strikes me that CIC 2.0 will share similarities with Singapore’s Temasek, which also began with a domestic focus and a mandate to safeguard Singapore’s strategic assets through professional management. Given that CIC 1.0 was in large part based on Singapore’s GIC, it is not all that surprising that China might draw further inspiration from the island nation.

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This website is a project of Professor Gordon L. Clark and Dr. Ashby Monk of the School of Geography and the Environment at the University of Oxford. Their research on sovereign wealth funds is funded by the Leverhulme Trust and The Rotman International Centre for Pension Management.

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