“However, with all that I’ve said, the world is still so underinvested [in China],” Chan added, noting that foreign holdings of listed companies in mainland China are still “in the low single digits”, compared with more than 30 per cent for Japan, while prices of US tech stocks might have become “quite frothy”.
“So, as you can see, there’s still a long way to go before the world catches up to a more normal, reasonable level.”
Global fund managers have poured into Chinese stocks in recent months, fuelled by improved sentiment and bets that faster artificial intelligence (AI) adoption will drive economic growth. Over the past month, equity markets in mainland China and Hong Kong have gained more than US$1.3 trillion in value. Earlier this month, Deutsche Bank said the rise of AI in China was the nation’s “Sputnik moment”.
“Despite the headlines, despite geopolitics, the real need is there,” he said. “China will almost thematically be a long-term structural exporter of capital, of services, of technology, and I think that trend will continue.”
