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A third of European professional investors expect China’s economic growth to be higher than the official target of “around 5 percent” for 2023, European ETF provider Tabula Investment Management Limited (Tabula) said in a report.
Nearly 84 percent of professional investors, who collectively manage over $250 billion of assets, expect the Asian giant to avoid a recession this year, said the report, based on a survey of European professional investors.
The view comes after China changed its approach last November from zero Covid to zero Covid restrictions.
Professional investors remain more optimistic about China’s real estate sector, with 98 percent believing that two years of pain and deleveraging will lead to a significantly stronger base for the industry going forward, the report said.
Nearly 62 percent of professional investors expect real estate sales to return to the long-term growth trend this year. More than a third of those surveyed expect pent-up demand to result in home sales exceeding this trend.
However, 86 percent of the survey takers believe the country’s inflation will breach the government’s preferred ceiling of 3 percent this year.
Tabula CEO Michael John Lytle said: “With Covid restrictions removed, and a series of supportive policy measures for the real estate sector deployed, the country is now on a strong footing for growth. Our research shows huge investor confidence in the government’s policies to support this growth.”
The strong inflows into the Tabula Haitong Asia ex-Japan HY Corp USD Bond ESG UCITS ETF reflect the growing optimism for China’s improving prospects, he said.
The ETF has seen net inflows of almost $100 million in the last 12 months and has returned over 50 percent since 1 November 2022.
The UK-headquartered Tabula commissioned Pureprofile to conduct research with wealth managers, pension funds, insurance asset managers and other institutional investors across the UK, France, Germany, Switzerland and Italy. The survey was conducted in February 2023.
(Writing by P Deol; Editing by Anoop Menon)
