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Focus on Funds

Global Capital Markets Offer New Opportunities

In the November 8, 2019, edition of Focus on Funds, ICI President and CEO Paul Schott Stevens discusses developments in Europe and Asia that hold promise for global fund managers and their investors.

Transcript

Stephanie Ortbals-Tibbs, ICI director of media relations: For funds and their investors, the health of the global capital markets is vital. So how do things look today? I got some new perspective from ICI President and CEO Paul Schott Stevens.

Paul Schott Stevens, ICI president and CEO: There were two leading indicators of whether Capital Markets Union would be successful.

One is whether there will be meaningful reforms that facilitate cross-border distribution of funds, changes in marketing rules, and things of that nature. And a second is whether the Europeans would create a product for retirement savers that would encourage investments in the markets’ risk-based assets.

Modest progress was made. I think there are many influential figures in Europe who are determined to try it again.

They realize that they need to diversify the sources of financing in their economy away from banks. They need to get retail investors into the equity markets, and taking risks, and getting greater returns. And so we’re doing whatever we can as ICI Global to encourage and facilitate that process—and also not just in Europe, but other countries as well, and to bring the US experience and the lessons we’ve learned to bear.

Ortbals-Tibbs: And what is exciting there as we look elsewhere in the world is there’s some good news out of China.

Stevens: The Chinese, interestingly enough, are involved in a historic liberalization of their markets. I think that there’s a recognition that now is the time for China to liberalize and welcome foreign participants in a way that they haven’t before in their markets. And that’s a good thing—not only for the Chinese investor but for our industry, which brings, I think, the most attractive solutions for retail investors.

Ortbals-Tibbs: What’s your view of capital markets development right now? Are there other things that are on your wish list or your worry list?

Stevens: I think there’s a recognition that what our funds do is really very important in creating opportunities for employment, economic growth, long-term savings and investment for retirement and other major goals. And so I think the outlook for the fund industry globally is very strong because of what we do—both for individual investors as well as for the economies.

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