Ray Dalio, founder of global hedge fund major Bridgewater Associates, and Lim Chow Kiat, CEO of Singapore’s sovereign wealth fund GIC, have expressed growing caution regarding the global economic outlook due to political risks and uncertain growth prospects, according to a report by the Straits Times.
Despite these concerns though, both leaders emphasised their continued commitment to investing in China, while acknowledging challenges including rising debt levels and geopolitical tensions.
Speaking at the Milken Institute Asia Summit 2024 in Singapore this week, Dalio cited geopolitical tensions, the financial impact of climate change, and other factors that pose downside risks for global investors in the year ahead.
“The surprises are more on the downside than the upside,” he said, while noting that the US, despite many positives, faces risks related to the upcoming presidential election.
Lim shared a similar cautious stance, stating that GIC is adopting a more selective approach to investment opportunities rather than making broad market allocations. He pointed out that the market has already factored in expectations of a soft landing and significant growth from the tech sector, prompting GIC to tread carefully.
Lim added that the US, which accounts for 39% of GIC’s portfolio, remains a key market regardless of the outcome of the election, given the strong private sector and attractive investment opportunities.
Although deal flow in China has been slow and growth expectations are low, Lim emphasized the importance of remaining invested in the world’s second-largest economy. “It may take a while for things to work through, but with great entrepreneurs, China is a place we cannot miss out on,” he said.
