CHINA’S US$653 billion sovereign wealth fund, China Investment Corp. (CIC), posted Friday a 12 percent jump in net profit for 2013, but warned that its performance is being pressured by global economic uncertainties.

    Created to earn higher returns for China’s US$4 trillion foreign exchange reserves, CIC said it liked the farming, property, infrastructure and high-tech sectors, but that it was getting harder to pick investments in an unpredictable environment.

    A bigger bet on global stock markets and government bonds in emerging countries — at the expense of sovereign bonds in developed economies — helped CIC earn a 9.3 percent return on its overseas investments in 2013, down slightly from 10.6 percent in 2012.

    “In this year’s environment, the pressures that we face in investment and returns are quite large,” said Liu Fangyu, CIC’s spokeswoman, declining to elaborate on any investment made by CIC in the past year.

    On a cumulative and annualized basis, CIC’s returns on its overseas investments — which are worth about US$200 billion in total, according to Liu — rose to 5.7 percent last year. That is its second-best performance since the fund’s inception in 2007, and up from a 5 percent return in 2012.

    CIC, whose previous high-profile investments included taking a 10 percent stake in Britain’s Heathrow Airport Holdings in 2012 for 450 million pounds (US$756.5 million), has not announced any deals of note in the past year as it underwent a leadership reshuffle.

    Chairman Ding Xuedong was appointed in July last year after his predecessor, Lou Jiwei, was made finance minister. Vice chairman Li Keping was appointed in February after the incumbent, Gao Xiqing, retired.

    Besides its foreign holdings, CIC has domestic investments, including ownership of swathes of China’s banking sector.

    For 2013, CIC said its net profits reached US$86.9 billion compared with US$77.7 billion the year before. It previously put its 2012 net profit at US$77.4 billion, and did not explain the discrepancy at a briefing to unveil the figures in an annual report.

    Between asset classes, global stock investments accounted for 40 percent of CIC’s overseas portfolio last year, up from 32 percent in 2012, the annual report showed. Financial stocks were CIC’s top pick, taking up 23 percent of its equity investment, followed by consumer shares at 12.5 percent and information technology counters at 12 percent. (SD-Agencies)