Tiny chal­lenger builds on mus­cle

China Daily (Canada) - - FRONT PAGE - By OSWALD CHAN in Hong Kong oswald@chi­nadai­lyhk.com

Lux­em­bourg, a tiny West Euro­pean na­tion with a pop­u­la­tion of about 521,000, is one of the largest in­vest­ment fund cen­ters in Europe and the world’s lead­ing hub for fund dis­tri­bu­tion. It is also the sec­ond big­gest fund cen­ter glob­ally, af­ter the US.

As­sets un­der man­age­ment (AUM) of the Lux­em­bourg fund in­dus­try rose to a his­tor­i­cal high last De­cem­ber of nearly $3.76 tril­lion, with 52 per­cent of the surge driven by net sales, ac­cord­ing to Lux­em­bourg for Fi­nance (LFF), a public-pri­vate part­ner­ship founded in 2008 be­tween the Lux­em­bourg gov­ern­ment and the Lux­em­bourg Fi­nan­cial In­dus­try Fed­er­a­tion to pro­mote the fi­nan­cial in­dus­try of the Euro­pean Union mem­ber na­tion.

Lux­em­bourg re­tained its po­si­tion as the lead­ing Euro­pean fund domi­cile, at­tract­ing more than 42 per­cent of net sales of Euro­pean reg­u­lated funds as at the end of Novem­ber 2014, LFF data show.

The Lux­em­bourg fund in­dus­try is tar­get­ing new mar­kets for fu­ture busi­ness ex­pan­sion, namely Brazil, Mexico, Aus­tralia and the Chi­nese main­land. On the main­land, pro­gres­sive ren­minbi in­ter­na­tion­al­iza­tion, the po­si­tion gained by Lux­em­bourg as an off­shore ren­minbi cen­ter and the suc­cess of the Shang­hai-Hong Kong Stock Con­nect pro­gram are fu­el­ing hopes of a grad­ual open­ing up of the main­land fund mar­ket to in­dus­try play­ers in the Euro­pean coun­try.

Since 2008, Lux­em­bourg-based UCITS (Un­der­tak­ings for Col­lec­tive In­vest­ment in Trans­fer­able Se­cu­ri­ties) funds can be dis­trib­uted on the Chi­nese main­land via the QDII (Qual­i­fied Do­mes­tic In­sti­tu­tional In­vestor) mech­a­nism.


Lux­em­bourg for Fi­nance, a public-pri­vate part­ner­ship founded in 2008 to pro­mote the fi­nan­cial in­dus­try, says fund in­dus­try AUM (as­sets un­der man­age­ment) in De­cem­ber 2014 hit a high of $3.76 tril­lion.

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