English Says CIC Investing in N.Z. Debt Wouldn’t Be Surprise

New Zealand Finance Minister Bill English said investments in his government’s bonds by China’s sovereign wealth fund wouldn’t be surprising after a report the Beijing-based company may buy some of the island nation’s debt.

“I wouldn’t be surprised if they allocate a tiny slip of it to New Zealand and a slightly larger slip of it to Australia,” English said at an event in Hong Kong today.

Asian nations are seeking to diversify record foreign- exchange holdings as the U.S. dollar’s decline threatens to erode returns. China Investment Corp., a $300 billion fund, may have set aside 1.5 percent, or about NZ$6 billion ($4.9 billion), of its reserves to invest in New Zealand, interest.co.nz reported earlier today, citing an unidentified person.

Chinese investors “realize if they don’t want political opposition to their investments, which is easily inflamed in most of the developed world, they need to tread pretty carefully,” he said.

China’s sovereign fund may have allocated 2 percent of its reserves for Australian assets, the Auckland-based website reported.

To contact the reporters on this story: Chris Bourke in Wellington at cbourke4@bloomberg.net; Sophie Leung in Hong Kong at sleung59@bloomberg.net

To contact the editor responsible for this story: Chris Bourke at cbourke4@bloomberg.net

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