GIC has been concerned about the"high uncertainty" in the global investment environment, given the increased market valuations and low volatility especially in developed markets, said its CEO Lim Chow Kiat.
Mr Lim said GIC's key concerns are inflation rising faster than expected; China’s slowdown being more than expected; a “flare-up” in geo-political concerns which are regular investor concerns; and, rising market vulnerabilities due to long periods of low market volatility and untested liquidity of new investment structures.
In such an investing environment, GIC has adopted a cautious stance on betas, or broad market exposures, but Mr Lim said the group simply cannot expect then to get the same levels of historical returns. Long term commitment to building local capabilities and widening reach via partnerships allowed GIC to expand its capabilities and partnerships in Brazil, he said. Since setting up in Brazil in 2014, GIC now has 30 people covering the market on the ground, he noted.