LONDON (Reuters) -Japan’s Government Pension Investment Fund has switched the benchmark it uses for foreign equities for its $1.7 trillion of investments, to one that does not include onshore Chinese shares it said in a recent update.
Some global investors have become nervous about owning domestic Chinese shares, known as A-shares, given global trade tensions and China’s domestic economic challenges.
The exclusion of China A-shares is due to the concerns that the pension’s investment may be hindered by potential issues including international settlement, market liquidity, restrictions on foreign investors, frequent policy changes and securities transactions suspension, GPIF said in a statement on March 31.
GPIF previously used MSCI’s All Country World Index (ex Japan) as a benchmark for its investments in foreign equities, but it will use that benchmark also excluding China A shares for the five years from 2025, it said.
(Reporting by Summer Zhen in Hong Kong and Alun John in London; Editing by Amanda Cooper and Tomasz Janowski)
