China's economic recovery affords world opportunities: global asset management institutions

Global asset management institutions believe that China’s economy is gradually recovering, which will bring the world more opportunities.

The 2023 GAMF annual conference was held in Beijing over the weekend. Global asset management institutions believe that China’s economy is gradually recovering, which will bring the world more opportunities.

The latest economic data released in January and February show that expectations for China’s market to accelerate has improved and that its economy has stabilized and spurred a rebound, drawing the attention of global investors.

Rob Sharps, CEO of the T. Rowe Price, who manages assets of trillions of US dollars, noted that while most major economies are dealing with inflation and tightening monetary policies, China is more flexible in monetary and fiscal policies due to its low inflation.

Sharps believes that China's economic activities will gradually resume, and domestic consumption is expected to grow significantly after the optimization of epidemic prevention and control measures, which will stimulate the private sector investment.

The stock trading price in China is currently lower than the long-term average from the perspective of valuation. Combined with improving fundamentals, China’s stock market presents attractive opportunities, said Sharps.

Jean Lemierre, board of directors at BNP Paribas, said China is returning to normal and its enterprises are resuming production. Chinese people, in particular, have a lot of savings in their bank accounts, which means strong consumption potential, and the market's evaluation of China has rebounded.

In the view of Nicolas Moreau, CEO of HSBC Global Asset Management, allocating assets to Asia is one of the strategies to respond to global financial market volatility. According to him, the inflation crisis in the West has led to continuous interest rate hikes by major central banks, which is in great contrast with Asia that has more optimistic growth prospects.

Moreau said the attraction of the Asian investment market lies not only in the potential of great returns, but also in the diversification of investment due to its environmental differences. And China's economic recovery will lay foundations for Asian economic growth.

Howard Marks, co-chairman of Oaktree Capital Management, thought highly of China’s non-performing assets market. According to him, the corporation started to invest in China in 2015 and big profits attract this corporation to continue to invest in China.

Ben Way, group head of Macquarie Asset Management, is interested in the opportunities brought by green transformation in China. He pointed out that last year, global investment in energy transformation exceeded one trillion US dollars for the first time.

China plays a leading role in the global clean technology supply chain, which will promote transformation both in China and in the rest of the world, said Way. In his opinion, financial institutions can seize these opportunities and play a practical and direct role in green transformation financing.

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