The FSA Spy market buzz – 13 December 2024
M&G’s positive outlook; Wisdom from Schroders’s podcast; Alliance Bernstein on the power of curiosity; Janus Henderson on responsible AI; China’s retirement revolution; Apple and much more.
Is OBOR more than a buzzword?
China’s epic infrastructure project, ‘one belt one road’, is getting its own index, according to the Hong Kong Stock Exchange. But OBOR does not excite fund managers.
About 70% of the belt-and-road projects will be related to the energy sector, said Karine Hirn, partner at East Capital, which specialises in emerging and frontier market investments.
“China is already building national champions and they will be the ones who benefit from investments alongside the [OBOR] initiative,” she said at a recent Hong Kong industry event by the Association of the Luxembourg Fund Industry.
For instance, Tajikistan, a small country in Central Asia with about $8bn GDP, has an estimated $6bn of committed investments from China, she said.
But so far she sees more opportunities on the revenue side of participating countries where energy or infrastructure investments can support economic growth, rather than investing in Chinese companies that can grow earnings by providing goods and services to OBOR.
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