Date
15 December 2017
Chinese authorities are seeking to boost the return on pension funds by widening the investment options. Photo: Bloomberg
Chinese authorities are seeking to boost the return on pension funds by widening the investment options. Photo: Bloomberg

China said to be readying pension investment reform plan

China will unveil a pension funds investment reform plan before the end of this year in a bid to boost the returns on the huge funds and support the nation’s aging population, the Securities Daily reported Friday, citing a source familiar with the matter.

The plan will incorporated into an overall reform scheme for pension insurance, the source was quoted as saying, without giving further details.

A social insurance researcher has proposed that regional pension funds could follow in the footsteps the national social security fund and corporate annuity funds to seek diverse investment portfolios.

In 2012, China took the first steps in reforming the way it manages the massive pension fund by beginning a trial investment in the country’s stock market. The southern province of Guangdong then won approval from the State Council to entrust 100 billion yuan of its pension fund to the National Council for Social Security Fund for two years.

The NCSSF said that most of the money would be placed in savings accounts or used to buy government and corporate bonds and other fixed-income securities.

According to data released by the Guangdong government, the annualized investment return of the entrusted pension fund was at 6.73 percent in two years, far beyond the return provided by bank savings deposit.

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