Guo Xiangjun, deputy general manager of China Investment Co., Ltd. ("CIC"), said that CIC recognizes the deep structural changes that are taking place: geopolitics and protectionism will become a reality; rising interest rates and market volatility will also pose challenges to investment. At the same time, the fourth industrial revolution, such as artificial intelligence, big data, etc., is on the rise.

He further stated that in the future, CIC will be committed to advancing the improvement of the investment environment, establishing an open and fair investment mechanism; increasing alternative and innovative investments to improve risk-adjusted returns, and establishing cross-border investment platforms through changeable and bilateral funds; Sustainable investment that incorporates environmental, social and governance factors into investment decisions.

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Globalization: Challenges and Solutions

Distinguished guests, ladies and gentlemen,

I would like to thank IFF for the warm welcome, and for hosting this important forum today. In recent years, a number of challenges have triggered intensive discussion on the future of globalization. In these remarks, I will provide CIC’s approach in response to this new era.

CIC Historical Context

Last year was an important milestone for China Investment Corperation---it was the 10th founding anniversary of CIC. Since inception, CIC has been tasked with a dual mandate in overseas investments: to diversify China’s foreign exchange holdings, as well as maximize returns for shareholders within risk tolerance.

Over the last decade, CIC overseas investments have delivered a net cumulative annualized return of 5.94%, exceeding the 10-year return target. Sensible long-term investment policies, grounded by a commitment to financial investing, and a belief in diversification, underpin CIC’s investment success.

As a long-term investor, CIC is well positioned to short-term market headwinds. Being a financial investor indicates that CIC choose to invest based on commercial basis, instead of seeking control of investees. CIC’s long time horizon also well suited to explore nontraditional asset classes, given their return potential and diversifying effect.

Looking Ahead

Looking forward, CIC recognizes those deep structural shifts underway: changes in geopolitics and protectionism will become reality; higher interest rates and market volatility will also challenge the investment performance; meanwhile, the fourth industrial revolution, such as artificial Intelligence, big data, etc. is rising. I will address three perspectives as follows:

First, advocate for better investment environment: sovereign funds are committed to an open and fair investment regime. CIC encourages a sound and transparent regulatory framework in our investment destinations. Now, the retreat of globalization，especially the trade conflicts between US and China is intensifying. We hope these two countries could solve the issue through negotiation and cooperation, instead of confrontation.

Second, increase exposure in alternatives and be “innovative”: under the new investment landscape, CIC will continue our efforts to ramp up direct and alternative exposure to enhance the risk adjusted return. We are also establishing cross-border investment platforms through multilateral and bilateral funds. Specifically, we are on the lookout for investment opportunities that can create synergy between domestic and foreign partners. In addition, infrastructure is an alternative asset class on the rise. CIC will search for opportunities in this area, in order to deliver stable return and improve connectivity of the world.

Third, explore sustainable investing: the adoption of sustainable investment is growing rapidly among institutional investors. CIC will also participate in this effort. Now, we are planning to incorporate ESG (Environment, Social , and Governance) factors into our investment and decision-making process, and finally build our responsible investment framework.

I remain confident in new globalization. CIC will adapt to the change,

and deliver sustainable returns for years to come.

Thank you!