The executive vice-mayor of Shanghai is expected to be named to the top position at China’s $500 billion sovereign wealth fund.
(May 13, 2013) - A new leader has been chosen for the China Investment Corporation (CIC), nearly two months after former chairman Lou Jiwei departed to be the nation's finance minister, according to the South China Morning Post.
Tu Guangshao, the executive vice-mayor of Shanghai, is expected to be named as chairman of China's $500 billion sovereign wealth fund in the near future. The 54-year-old is a member of the Communist Party of China's standing committee, according to his biography on the Shanghai mayor's office website.
Before joining city government in 2007, Tu held various positions at the Bank of China, Shanghai Stock Exchange, and the national securities regulatory commission. He also earned a master's degree in economics from Peking University.
"Tu is a capable senior cadre with a good command of English," a Shanghai finance official told the newspaper. "He's open-minded and keen on financial liberalization to drive the markets on a par with international practices."
A revised investment strategy already helped CIC pulled down returns over 10% last year, the fund's former boss told CNBC Asia in January. "We had to change our tactics because we observed some volatility in the market, especially volatility that was created by policies and this really hampered return prospects," Lou said. He did not expand on what these changes were, but pointed to domestic markets, other Asia nations, Canada, and the United Kingdom as sites of opportunity.
Both Lou and CIC's President Gao Xiqing have remarked that the United States offers an increasingly unwelcoming investment environment. Gao told conference attendees in April that CIC "singled out as a different investor" in the US. "We thought we were friends," Gao said. "All of the sudden, you've got people slapping you in the face and telling you, 'OK, we don't like you.'"
Tu has actively cultivated Shanghai's international relationships during his six years in charge of the city's finance, taxation, and external affairs. He has liaised publically with Australia's foreign minister, Singapore's consul-general, the deputy-mayor of Paris. On May 9, Tu met with the grandson of former US President Richard Nixon, who was retracing his grandfather's famous 1972 visit to China.
Related profile: Lou Jiwei, Former Chairman and CEO of China Investment Corporation