Goldman Sachs’ David Solomon says it is too difficult to get capital out of China
With venture capital transactions by American investors at the lowest level in nearly four years, investors need reassurance, Solomon says
“When I listen to global investors, one of the things they continue to be concerned about is they put a lot of capital in and it’s been very difficult over the course of the last five years to get capital out,” Solomon said. “I think messages around the ability to both attract capital and have capital come in and come out are very, very important for global investors.”
Solomon spoke at the Global Financial Leaders’ Investment Summit, which was organised by the Hong Kong Monetary Authority (HKMA). The event kicked off on Monday.
But the number of deals has gone down in recent years, due to US-China tensions and crackdowns on tech companies and after-school education providers. Global investment in China’s private equity and venture capital markets is drying up, and many firms face limitations on how to get their capital out of the country. In 2023, the number of venture capital transactions by American investors in China reached its lowest level in nearly four years, according to data compiled by Crunchbase.
In addition, foreign direct investment in China is at an all-time low, and capital outflow has been accelerating since the pandemic, according to official data and analyst reports.
