Since 2000, China has been responsible for more than 70% of global demand growth for coal, 60% of global demand growth for steel, and more than 50% of global demand growth for aluminium, according to BarCap research.
“The use of risk management tools is well-established and well-understood. However, compared with other geographies, they tend to be shorter-term and fewer products are used,” said de Vitry. He speculated that increased involvement by the CDB in the commodity derivatives market could alter the country’s regulatory approach to the sector.
“China's regulation and legal framework around derivatives has evolved over the past few years and I am sure that to have market participants like CDB in commodity derivatives will continue, and even strengthen, that evolution.”
Barclays announced CDB was to take a £1.5 billion (3.1%) share in the bank in July. Its investment came at the same time as the Singapore government-owned investment vehicle Temasek bought a smaller £1 billion (2.1%) stake. They have pledged a further £5.1 billion and £1.5 billion, respectively, if the company’s takeover bid for Dutch bank ABN Amro succeeds.