[Text/Observer Network Wang Kaiwen] US President Trump's absurd tariff policies and territorial expansion remarks are causing increasing concern and aversion, with these bullying actions backfiring on the United States.
According to a report by the UK Financial Times on April 13, large Canadian and Danish pension funds are suspending or re-evaluating their investments in the US private market, stating that they will not resume investment in the US until Trump's unpredictable policies come to an end and the US returns to stability.
The report pointed out that these measures highlight how large institutional investors are reconsidering their investments in the world's largest economy as the US president's trade policies disrupt the market. This adds more pressure on the increasingly liquidity-constrained private capital in the US.
A senior executive of a large Danish pension fund told the Financial Times that due to concerns about instability and considering Trump's threat to take over Greenland, the fund has suspended new investments in US private equity. "If some private equity funds say 'we have a great investment in the US', we would say 'no, thank you, let's talk again in half a year when the situation becomes more stable and predictable, otherwise we will have to offer a big discount'," the executive said, adding that the US attitude towards Greenland is "very hostile", making it difficult for anyone to smile and say "we want to start investing in that country (the US)".
Anders Schelde, Chief Investment Officer of Danish pension fund AkademikerPension, which manages assets worth 150 billion Danish kroner (approximately 167 billion RMB), said he now discusses the attractiveness of US investments every day.
Schelde said he has started considering a "fundamental adjustment" to his investment portfolio, which will certainly lead to a significant reduction in strategic investments in US assets within about six months.
Stephanie Lose, Danish Minister of Economy, told the Financial Times that she was not sure if Danish funds had changed their US investment strategy, but added that due to "risks and uncertainties", funds tend to scale down investments, and these decisions could be side effects of tariffs and the Greenland issue.
On local time April 4, 2025, traders were trading at the New York Stock Exchange. Due to Trump's aggressive tariff policies, Wall Street stocks suffered another heavy blow on the 4th. Visual China
Some large Canadian fund companies are also considering no longer investing more in US private assets, one of which is the Canada Pension Plan Investment Board (CPPIB) managing 699 billion Canadian dollars (approximately 3.68 trillion RMB). A source familiar with the matter revealed that due to concerns about the possible loss of tax advantages in the US, CPPIB has become more cautious about its investments in US infrastructure.
Another person who recently discussed with CPPIB said that given the current geopolitical background, it would become "very difficult" for the institution to inject new funds into US private equity funds.
CPPIB holds substantial stakes in over 50 industrial, retail, office, and residential properties in the US. According to statistics from the Financial Times, as of the end of September last year, the institution has invested nearly $50 billion in US dollar-denominated private equity funds, including funds operated by Silver Lake Capital, Carlyle Investment Group, and Blackstone Group.
A person familiar with the strategy of another large Canadian pension fund said there is "great uncertainty" regarding what types of infrastructure investments the Trump administration welcomes.
Due to tariff issues and Trump's repeated threats to make Canada the "51st state" of the US, tensions between Ottawa and Washington have intensified.
"If we feel uncomfortable with our investments in the US within six months or a year, we will reduce transactions. Then, we will consider adjusting our strategy," the person added.
There are also pension funds planning to maintain their investments in the US. Caisse de dépôt et placement du Québec (CDPQ), which owns assets worth 473 billion Canadian dollars (approximately 2.49 trillion RMB), in the view of Martin Longchamps, head of private equity and credit, finds it difficult to invest anywhere amid the increasing geopolitical complexity. "We intend to remain active in the US," he said.
However, Longchamps admitted that the noise from tariffs makes it harder to assess businesses. "We must take this into account before the situation stabilizes," he said.
Two top US private equity fund executives told the Financial Times that they are already worried about new investments from Canadian investors in their funds. Although there has been no change in the flow of funds so far, they believe that Trump's aggressive stance towards Canada has angered the latter. Another risk point lies in the possibility that the US may pressure Canada's large pension institutions to limit new investments in the US.
According to the Singapore Straits Times, Jonathan Gray, president of Blackstone Group, said last week that long-term uncertainty in global tariff policies could exacerbate market chaos and warned that Trump's trade measures might affect the financial system. He emphasized that the longer market volatility persists, the greater the likelihood of problems arising and triggering a domino effect.
According to the latest Bloomberg Markets Live Pulse survey, despite Trump's announcement last week to suspend "reciprocal tariffs" on multiple countries for 90 days, investors are still seeking to avoid US assets.
This survey conducted from April 9 to 11 showed that 81% of 203 respondents plan to maintain or reduce their holdings in US assets; more than half of the respondents are looking for destinations outside the US market, with two-thirds choosing Europe.
Another survey conducted from April 4 to 9 also showed similar results. Among 647 respondents, more than half said they plan to reduce their holdings in US assets.
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