China Life May Invest in Property Market
Yang Chao, Chairman of China Life Insurance Co Ltd, said yesterday that the company plans to have a try at the property market to diversify its investment lay out. He said China Life would seek to invest in infrastructure, equity, fixed-income securities and the property market.
According to Yang, China Insurance Regulatory Commission is expected to permit insurers to invest in infrastructure and real estate soon and is drawing up guidelines concerning it. China Life is waiting for the inaction of these regulations and making preparations for their emergence.
Industry analysts confirmed the promise of more profits through more investment options, not only in capital markets but also in property market. The financial downturn led to a tremendous fall in capital markets, resulting in 61.4% decrease in total return in 2008 and 45.3% drop in net profit. China Life has changed its capital distribution, emphasizing on fixed-income securities and term deposits while reducing its proportion on equities.
Donghai Securities analyst Tao Zheng’ao suggested that the insurers seek long-term investment opportunities to win stable returns, and he showed his preference in the commercial market instead of residential housing market. He also recommended some more fields such as private funds and the soon to-be launched real estate investment trusts. Industry experts advised that learning from international experience, it should be better that the insurers’ property investment consist 5% of their total investment at the most.
Orient Securities analyst Wang Xiaogang says since it is without precedent that Chinese insurers’ would be permitted to invest in the property market, it is necessary to set a lower investment threshold to control risks. He suggests limiting investment in commercial property, equity and infrastructure to no more than 5% of the total.
Are you interested in the business opportunities in China?
China is one of the world’s great growth markets and is likely to be for many years to come. Foreign companies often face difficulties in assessing Chinese market demand and enacting effective strategies because of the language barriers, culture differences, and high expense.
BPOVIA is the leading virtual assistant and Knowledge process outsourcing (KPO) service provider in China. BPOVIA is the only virtual assistant company ever been nominated for the prestigious “Red Herring 100 Asia” Awards 2008. Combines international perspective with local know-how, BPOVIA can provide our clients China business development service and help our clients doing successful business in China.
Please visit http://www.BPOVIA.com/ for details about our service.
Popularity: 4% [?]