The China-ASEAN Joint Investment Council (CAJIC) wants to facilitate and structure institutional investment into Southeast Asia. It brings sovereign investors together to benefit from investment opportunities in the ASEAN region in the area of long term investment and co-investment.
The council, led by the China Investment Corporation (CIC) with 15 other investors, including Azerbaijan’s SOFAZ and Indonesia’s INA, is part of a larger effort to link Chinese institutional investment with the growing markets of Southeast Asia.
Building a Regional Investment Network
CAJIC establishes a network of investment opportunity identification led by Member and open to all ASEAN members on the identification of investment opportunity across ASEAN. CGS International Securities acts as its Secretariat, assisting to coordinate the participating institutions and potential projects.
Sovereign investors are able to fill the gaps in the market of patient capital to fund projects with a long gestation period. This gives rise to opportunities that go beyond the short-term private investment.
$1 Billion Fund Adds Financial Firepower
Traveling with CAJIC, the Galaxy Orientis China-ASEAN Investment Program (CAIP) is a private-equity project that aims to raise $1 billion. It has raised the first close of some $520 million.
The project focuses on industrial integration, consumer markets, healthcare and technology. The sectors align with areas where the growth of the ASEAN economies are expanding.
Linking Investment With Trade Integration
The investment council is expected to complement the process of economic cooperation between the two continents, such as the CAFTA 3.0 upgrading and ASEAN China Plan of Action 2026-2030.
Expanding trade must go beyond merely reducing barriers. Equally vital is financing for businesses’ factories, logistics, digital systems and energy networks. CAJIC could use institutional capital to provide the “bridge” between the trade and investable projects.
Supply Chains Drive the Opportunity
Global trade fragmentation has led to the creation of more fragmented production networks and added significance for Southeast Asia in its role as a hub for manufacturing and supply chains.
Meeting points such as investment hubs Jakarta, Singapore and Kuala Lumpur can be used as launching points for investment spread across the various economies in ASEAN. Financial transactions and investment by institutions in China might help to stimulate industry expansion and build new production networks.
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What Will Determine CAJIC’s Success?
Its long-term implications will be dependent on execution. Institutional commitments will be transformed to investments if they can be supported by transparency, good governance, regulatory frameworks and commercially viable projects.
In the long run, CAJIC is a bid to produce a more “capital-driven” and “capital-coordinated” China-ASEAN economic integration. It will be judged by the projects the money shall bring to Southeast Asia.
FAQs
What is CAJIC?
CAJIC is an investment platform that brings together various institutional investors to SE Asia and China international investment opportunities.
Who convenes CAJIC?
China Investment Corporation is the initiator of the council, with various institutional participants such as SOFAZ and INA from Indonesia.
What is a CAIP fund?
CAIP is a private equity initiative that aims to raise a $1 billion fund and has an initial close of about $520 million.
