Photo: Wikimedia Commons
Despite all the concerns about a slowdown in China, David Rubenstein, Co-Founder and Managing Director of The Carlyle Group continues to be a China bull.Speaking at the Bloomberg Link China Conference, Rubenstein said that China’s middle class is expanding, its consumer base is growing, and, its government encourages private equity investments.
Rubenstein, who has already invested in China’s consumer story, did however say that the market was a better bet for long-term investors:
“My point of view is, as a private equity investor, we have a long term perspective. For private equity investors, we invest for four to six years, maybe seven years at a time. If you are a trader and you have to worry about instant profits, instant market movements, any market can have difficulties in the short term. If you are over leveraged you can always have problems. If you’re worried about bubbles and you’re trying to make trading profits you can always be concerned about some emerging markets. But if you’re in for a longer term investment then you can ride through these periods of time… If I could put more money into China I would.”
Despite concerns about the Chinese property market, Rubenstein said he thought Chinese real estate investment was a good thing, as long as investors were not over-leveraged and they didn’t need to move in and out quickly.
“As the population moves more and more from the rural areas to the urban areas, there is going to be more demand for office and residential construction and buildings and so forth. So over a period of time you can expect prices to go up. Now I realise there may be some bubbles in some areas, residential real estate or office real estate in certain cities. But general on a five-10-fifteen year trend line it’s hard to see how real estate prices will go down an appreciable amount, and so I think it’s a very attractive area in which to invest.”
Rubenstein shied away from answering questions about the Carlyle Group’s specific investments in China and other emerging markets because of SEC constraints.