Schroders Investment: China's pension market is expected to grow far faster than the capital market.

In a recent speech, Schroders Global Investment Group CEO Ou Feide pointed out that the trend of aging population in China is driving the development of the domestic pension service market in Mainland China, and the growth rate of the market is expected to far exceed that of the Mainland Chinese capital market. At the same time, he is optimistic about its role in promoting the Mainland Chinese capital market and overall economy. Ou Feide further pointed out that it is very advantageous to consider incorporating overseas assets into China's pension investment portfolio. On the one hand, it can provide investors with more diversified investment opportunities and also help to diversify the risks associated with investing in a single market. On the other hand, issuing more pension business licenses in China can allow more financial institutions to participate in the Mainland Chinese pension financial market, and improve the quality and breadth of enterprise annuity products in the second pillar of the pension insurance system. Ou Feide stated that in product design, it is necessary to create flexible and personalized pension investment channels since investors in different life stages have different financial needs and investment goals. In the future, the industry is expected to develop innovative pension products such as private pension funds with diversified and qualified domestic institutional investor (QDII) overseas investment quotas and Real Estate Investment Trusts (REITs). In addition, Ou Feide also shared Schroders Global Investment Group's experience in integrating retirement finance with green finance. In the UK, the group invests insurance and retirement assets in renewable energy infrastructure, helping achieve long-term stable returns and decarbonization goals. Schroders Global Investment Group's Schroders Global Green Team is the UK's largest investor in renewable energy infrastructure, and the team is currently working on developing investment opportunities in Chinese renewable energy infrastructure to support customers in achieving their emission reduction goals through investment in high-quality clean energy generation in China. As the world's largest renewable energy market, as of the end of September 2024, China's wind power and CECEP Solar Energy installed capacity reached 1.25 billion kilowatts, providing significant investment opportunities to promote the transition to renewable energy. In a low-interest rate environment, allocating insurance and pension assets to renewable energy infrastructure not only helps investors achieve stable long-term returns but also aligns with China's green finance policy to create significant positive impact. Looking ahead, Schroders Global Investment Group looks forward to continuing to contribute to the development of China's pension ecosystem and working together with the industry and investors to seize the opportunities brought by the opening up of the Chinese financial industry and address the challenges posed by an aging population.