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China Plans New State Pension Firm as Population Ages
China plans to create a new state-owned pension firm to tackle a massive funding gap as the world’s largest population struggles to finance retirement despite decades of economic growth.
The China Banking and Insurance Regulatory Commission is mulling a national pension company with state-owned banks and insurers as shareholders, according to people familiar with the discussions. Details such as the shareholding structure and size of investment are still being hammered out, they said, declining to be identified as the plan isn’t public.
China’s authorities are seeking to expand its pension industry to supplement state-led coverage and build up more long-term funding while benefiting its capital markets. The nation’s elderly population could reach 300 million by the end of 2025, and a gap in retirement savings could reach 10 trillion yuan ($1.5 trillion) in a decade, according to a November report by the Insurance Association of China.
“The aging population is indeed a very big challenge, and we’re actively studying” ways to tackle it, CBIRC Chairman Guo Shuqing told a briefing in Beijing last week, without elaborating.
The CBIRC didn’t immediately reply to a request for comment Tuesday.
Read more @Bloomberg
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