Economy

China’s sovereign wealth fund is bullish on this sector

CIC: 'Very interested in global infrastructure'
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CIC: 'Very interested in global infrastructure'

China Investment Corp. (CIC), the mainland's $575 billion sovereign wealth fund, is shifting its focus away from the energy sector towards investments in infrastructure in both developed and emerging markets, said Chairman and CEO Ding Xuedong.

"I am interested in investment opportunities in infrastructure around the world. In the next 5-10 years, infrastructure investment will be a big theme for both emerging and developed markets. So, we want to increase our investment to get better returns," Ding told CNBC on Tuesday.

CIC is also eyeing potential investment opportunities in agriculture and real estate, he added.

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"In the past, CIC has had an overweight position on energy because of strategic importance. But since the global financial crisis, especially in the last two years, the returns from energy investments have not been great. Going forward, we may continue to invest in the sector but we will be extra careful," Ding, who took the helm of the massive state investment vehicle around six months ago, said.

Half of the CIC's assets are currently in developed countries corresponding with the "strong" economic rebound in the U.S. and recovery in Europe, said Ding, adding that the fund plans to maintain an overweight position in developed economies.

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CIC's treatment in the US vs Europe

Following CIC President Gao Xiqing's remarks last year on the fund's treatment in the U.S. – including that it is "singled out of as a different investor" by the country's regulators – Ding said CIC does face regulatory constraints in "certain countries, sectors and projects."

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"I do not rule out the fact that some officials have double standards or discriminatory acts. In those kinds of situations, we will appeal to local regulators and explain our investment purposes so as to gain equal treatment. The situation is improving, but we need to keep up the work," he said.

However, Ding singled out one country for its open and friendly approach to foreign investors: the U.K.

"Therefore, we have a wide range of investments in the U.K. and we are growing fast there," he said.

CIC autonomy in question

CIC, which is responsible for managing part of China's vast foreign exchange reserves, is "completely independent" as sovereign wealth fund and long-term investor, said Ding.

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"We don't take directions from the central government or have to meet certain targets by government ministries. We are completely independent in deal making and investment management. We are accountable to our investment returns," he said.

"Our goal is to diversify our foreign currency reserves, and use our trade surplus to invest overseas and achieve good financial returns. CIC makes decisions on its own when it comes to big and important investment projects," he added.

—By CNBC's Ansuya Harjani. Follow her on Twitter: @Ansuya_H