China Investment Corp. (CIC), the country’s sovereign wealth fund, was taking a cautious stance toward investments and would not invest in financial derivatives that had no obvious relationship with the real economy, CIC chairman Lou Jiwei said here Saturday at the China Development Forum 2009.
These derivative financial products should be phased out of the financial market, Lou said.
The CIC suffered big loss from its two major investments in the U.S. private equity firm Blackstone and investment bank Morgan Stanley during the global financial crisis.
The CIC has invested 3 billion U.S. dollars in the Blackstone and 5 billion U.S. dollars in the Morgan Stanley.
The CIC was set up in September, 2007, with an initial capital of 200 billion U.S. dollars from the country’s massive foreign exchange reserves, which stood at 1.95 trillion U.S. dollars by the end of 2008.
Source: www.sohu.com, CITI Liang Haisan, 21.03.2009
Filed under: China, News, Bailout Lesson, Black Swan, Blackstone, China 中国, CIC China Investment Corp, Derivatives, Derivativos, Equity, Financial Crisis, FOREX, Lou Jiwei, Morgan Stanley
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