Rothschild hops on board the crowded Orient Express

EXEMPT FUNDS | Rothschild hops on board the crowded Orient Express

Rothschild Asset Management could be excused for describing its move to China as child's play with growth predictions of 20 percent in the next 10 to 15 years signalling what to expect from its latest China fund. The Greater China Investment Fund was launched in Hong Kong in the middle of June, with Rothschild allocating $600 million of the funds $1 billion towards Hong Kong thus joining a surge of international fund managers expanding into the region. Nevertheless with every man and his dog scrapping for a piece of China's wealth will this fund find its niche or will it be destined for the scrapheap? Rothschild Chairman Philippe Couvrecelle figured that Asia "is the region where we can achieve more than a 20 percent growth rate for investment in the next 10 to 15 years and if we want to keep a 20 percent growth rate in the short-term, we have to be in Asia and specifically China." This is not the first time Rothschild has made its presence felt in China with the launch of its Saint-Honore Chinagora Fund in the mainland market in 2006 and a 15 percent stake in the China Zhonghai Fund. Rothschild is now keeping itself busy raising US$465 million for a China-focused private equity fund which is designed to invest in small and medium-sized companies. AXA Investment Managers CIO, Nigel Richardson expects even greater investor exposure to China in the years ahead despite the volatile climate, "the implications of 1.3 billion people growing over 10% per annum are clear. That is, China is the biggest developing economy story in history; it will ultimately reap rich rewards for long-term investors." Investors are recognising China's sustained growth story and "obviously want to be exposed to the long-term benefits emanating from funds like this."