Amundi has launched an investment fund that seeks to capitalise on likely beneficiaries of China’s multi-country Belt and Road Initiative (BRI) and similar initiatives.
China proposed the BRI in 2013, referencing the ancient Silk Road, to act as a catalyst for new trade routes and growth across Asia, Europe, the Middle East and Africa.
Amundi said the new “eco-system” would cover over 65 countries, with €1tn of planned investments in 1,700 infrastructure projects.
Announcing the launch of its Amundi Funds New Silk Road, the asset manager said the fund aimed to achieve long-term capital growth above the broader emerging market equity universe.
It would try to benefit from “second and third order effects” of the BRI and similar initiatives aimed at growing trade along the new silk roads rather than focusing purely on investments that could profit from first-order effects, the firm said.
Yerlan Syzdykov, global head of emerging markets at Amundi, said: “The Amundi Funds New Silk Road aims at investing in the areas associated with the BRI project, rather than investing directly where the BRI invests.”
He said the firm had observed that many BRI projects with potential primary effects may not offer the most attractive investment opportunity.
“Hence, we are willing to look beyond China and infrastructure to seek out investment opportunities that we believe will benefit from the expected expansion in trade and associated economic growth along the new Silk Roads,” Syzdykov said.
Amundi said the fund’s investment process was “designed to navigate geo-political sensitivities along the New Silk road, integrating top down analysis with stock picking”.
The goal was to have a high-conviction portfolio of 60-90 entities, it said, adding that this followed the launch of its New Silk Road cross asset solutions, which had attracted more than €459m since April 2019.