AIMCo Opens First Asian Office in Singapore
Alberta Investment Management Corp. (AIMCo) is opening its first Asian office, but the Edmonton-based fund manager says it will steer well clear of China to focus instead on markets with less geopolitical risk.
Expansion into Asia-Pacific Region
The official opening Tuesday of AIMCo’s new Singapore office marks the first foray into the Asia-Pacific region for what is one of Canada’s largest institutional investors, with $158 billion of assets under management as of 2022.
CEO Evan Siddall said AIMCo has up until recently been missing out on investment opportunities in the large, fast-growing economies of Asia.
Focus on Less Risky Markets
Siddall stated that AIMCo will focus on markets with less geopolitical risk and will avoid China. He mentioned that AIMCo is under-represented in Asia and has missed opportunities in the region.
Push for Global Diversification
The Singapore office opening is part of AIMCo’s larger push towards greater diversification globally. The fund manager already has offices in Calgary, Toronto, London, Luxembourg, and Edmonton, and will soon be opening a New York City office.
Asia is an important market for AIMCo due to the economic growth in many countries surpassing that of the U.S and Europe. Siddall believes that AIMCo can and should do more in Asia on a risk-adjusted basis.
Lagging Behind Other Canadian Institutional Investors
AIMCo is lagging behind many other Canadian institutional investors in establishing a foothold in Asia. A report by the Asia Pacific Foundation of Canada found that Canadian pension funds invested $25 billion in the region between 2003 and 2017.
Concerns about China
Canadian pension funds have faced scrutiny for their exposure to China, given concerns about the country’s economy and ongoing tensions with the West. The Canada Pension Plan Investment Board has recently laid off employees at its Hong Kong office as it steps back from deals in China.
Choosing Singapore over China
AIMCo has chosen to focus on the comparatively safe Singapore market instead of China due to geopolitical risks. Siddall emphasized the importance of considering risk factors in investing and mentioned that AIMCo has minimal investments in China.
Improved Performance in 2023
After reporting a loss of 3.4% for 2022, AIMCo has seen significant improvement in its performance in 2023. The fund manager reported a net investment return of 4.5% for the six-month period ending June 30.
© 2023 The Canadian Press
