Fiddich Review Centre
Alternative Investment

Investment Review Finds Limited Funds in China

SIOUX FALLS, S.D. (AP) — South Dakota Gov. Kristi Noem said Wednesday a recent review of the state’s investment portfolio found the state did not hold any direct investments in China but has stakes in emerging markets funds that invest in the Asian economic power.

The Republican governor, who is seen as a potential contender for the 2024 White House, has taken aim at China with recent orders. Earlier this month, she gave the state’s Investment Council a week to review its $19 billion portfolio for ties to China, arguing that all companies in the country are tied to its Communist government. In letters released Wednesday, she called on Congress and The Vanguard Group to assist the state’s efforts to divest from China.

In a series of hawkish steps and statements, Noem has sought to define China as a “nation that hates us,” argued the country poses a threat to American food supplies and claimed in a letter to Congressional leaders that the Chinese government has “infiltrated the homes” of Americans who use TikTok, the popular video-sharing app that is owned by a Chinese company. The governor last month banned the platform from state-owned devices and over a dozen states have followed suit.

Her office said Friday that the state had previously divested from three Chinese companies, but has 1.3% of its portfolio invested in an emerging markets exchange-traded fund, which in turn has one-third of its holdings in China. Noem sent a letter to the CEO of The Vanguard Group requesting that it create an alternative fund without investments in China.

“This would provide states the opportunity to safely invest our state trust fund and pension dollars without exposure to the threat of the CCP,” Noem wrote, referring to the Chinese Community Party.

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The governor is also asking the South Dakota Investment Council to come up with alternative investments.

U.S. President Joe Biden last year expanded a list of Chinese companies whose shares are off-limits to American investors because of their purported links to the Chinese military and surveillance. Chinese officials vehemently objected to that move.

Copyright 2022 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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