Eleven funds, under the Qualified Domestic Limited Partner programme, have been launched so far this year. File
| Photo Credit: Reuters

Global fund launches in China have hit a record as a weakening yuan and fragile economy drive demand for foreign assets, in the latest sign of low confidence among domestic investors.

Eleven funds issued under the Qualified Domestic Limited Partner (QDLP) programme have been launched so far this year, according to data by Z-Ben Advisors, already outpacing the full-year number from any previous year.

Managers such as Blackstone, Bridgewater Associates, and Oaktree Capital Management have opened funds, though they did not disclose total fundraising.

The products, which raise money from high net worth and institutional investors and invest in overseas assets, are booming as Chinese markets flounder. The yuan is at six-month lows on the dollar, the stock market shows signs of fatigue after a rebound from 5-year lows struck in February and benchmark 10-year government bond yields have hit record lows.

“Investors’ demand for offshore products have been rising quickly this year due to a weak yuan and sentiment,” said Ivan Shi, head of research at Shanghai-based Z-Ben Advisors, adding alternative investments and foreign bonds are popular.

In April, Blackstone launched its first QDLP fund, channeling money to the firm’s Private Equity Strategies fund.

The initial sales target of $40 million was reached in less than two weeks, according to two people familiar with the matter. Blackstone declined to comment. Market participants say Chinese authorities are largely encouraging the sector and more products are on the way.

The Global Fund announced on August 30 a deal with generic pharmaceutical manufacturers to significantly slash the price of a cutting-edge HIV drug, in a move it said would save lives.

The Global Fund, a partnership set up in 2002 to battle AIDS, tuberculosis and malaria, said the agreement would make it possible to provide the advanced pill known as TLD for under $45 per person per year.

“This improved pricing— a 25% reduction— will allow governments in resource-limited settings to expand access to critical HIV services,” it said in a statement.

The three-in-one pill bands together the drugs tenofovir disoproxil fumarate, lamivudine and dolutegravir.

The World Health Organization has recommended it as the preferred first-line HIV treatment for adults and adolescents since it rapidly suppresses the virus that causes AIDS, has fewer side effects and is easy to take, the statement pointed out.

“The countries most affected by HIV face enormous fiscal constraints, and there are still millions of people who are HIV-positive who don’t have access to quality treatment,” Global Fund chief Peter Sands said in the statement.

“Reduced pricing for TLD means governments and other implementers of Global Fund grants can expand treatment programmes and invest more in prevention, saving more lives and reducing new infections.”

August 30th’s announcement comes after the Global Fund, along with UNAIDS, the Bill & Melinda Gates Foundation and other partners in 2017 secured licensing agreements ensuring that TLD could be made available in low and middle-income countries for up to $75 per person per year at the time an unprecedented pricing level.

Thanks to that deal, around 19 million more people living with HIV in resource-constrained settings are today receiving TLD, according to the Clinton Health Access Initiative.