The 2025 Sustainable Global Leaders Conference was held from October 16 to 18 at the Shanghai World Expo Park. Huang Ming, Deputy Party Secretary and Vice President (Acting) of PICC Asset Management, delivered a keynote speech on "Asset Allocation Strategies in the Low-Interest-Rate Era and Technological Revolution." He analyzed the opportunities and challenges brought by macroeconomic and industrial transformations, as well as the strategic transition path for the insurance asset management industry, providing practical insights for high-quality development.
Huang Ming highlighted the core challenges facing the insurance asset management sector: "Traditionally, fixed-income assets served as a 'safety cushion,' while equity investments were supplementary. Now, the 'safety cushion' is thinning, and equity investments are increasing, posing significant challenges." This shift reflects profound global macroeconomic and technological changes—from 2001 to 2023, the U.S. and Europe's share of the global economy dropped from 62% to 50%, while Asia's rose from 27% to 36%, with China and India becoming key drivers. Asia's industrial chain has moved beyond low-end manufacturing, gaining global competitiveness in high-end sectors like semiconductors and new energy. However, deglobalization and intensified tech competition, led by Western economies, have introduced market volatility.
Domestically, economic restructuring and the low-interest-rate cycle have compounded industry pressures. Huang noted that China's economy is transitioning from investment-driven to new growth momentum, with rapid expansion in new energy and semiconductor industries. Electromechanical products have replaced textiles as the top export, yet structural imbalances persist due to weak external demand and insufficient domestic consumption. Meanwhile, declining capital returns in the real economy and a shrinking demographic dividend have pushed China into a prolonged low-interest-rate cycle. Although rates near 1.5%-1.6% are close to their floor, and the "engineer dividend" and industrial upgrades provide support, the risk of negative spreads remains a major concern—listed insurers' investment yields have fallen by 30-50 basis points annually, now below 3%.
To address these challenges, Huang outlined PICC Asset's transformation strategy. On the fixed-income side, the focus is on "duration gap management and innovative non-standard investments," balancing liability controls with tactical investments to narrow gaps while shifting from traditional to innovative non-standard assets, such as REITs. The firm has invested over RMB 20 billion, launching two self-developed real estate support plans (RMB 2.5 billion each) and a RMB 5 billion product via the China Insurance Exchange. On the equity side, volatility is mitigated through "account optimization, balanced investment styles, and diversified strategies," such as blending OCI (Other Comprehensive Income) and TPL (Fair Value Through Profit or Loss) accounts and balancing dividend and growth assets.
New regulations, including "C-ROSS Phase II" and accounting standards, are accelerating industry transformation. Huang emphasized that under the new standards, investment returns are more volatile due to market fluctuations, requiring stable performance through prudent asset allocation, duration matching, and risk hedging.
Despite challenges, Huang stressed opportunities from technological advancements and sustainability. China excels in ESG, with new energy generation and capacity surpassing traditional sources. PICC Group achieved MSCIESG's highest 2A rating and a spot on Forbes China's ESG 50 list, underscoring sustainable investment value. The industry must adopt diversified, refined strategies to navigate changes, aligning with national priorities and financial reforms for value growth with controlled risks.