Contributing to a Harmonious Society: China’s Sovereign Wealth Fund

This chapter 1 examines key factors that led to the establishment and subsequent organisation of one of the world’s largest sovereign wealth funds: the China Investment Corporation (CIC), which began operating in September 2007 after an earlier incarnation as a state-owned commercial vehicle, Huijin. In principle, national governments establish sovereign wealth funds (SWFs) to recycle the country’s foreign exchange reserves. In China’s case, establishment of the CIC was not simply to maximise return from foreign exchange reserves but was also with an eye to the imperative of maintaining a ‘harmonious society’ ( hexie shehui ). These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.