Sen. Marco Rubio (R-FL) announced on Monday that he would introduce legislation to prohibit federal government pension plans from investing in Chinese stock.
Rubio’s bill is a reaction to a fund delaying a tracking decision for an index provided by MSCI Inc.
Reuters reported on the development:
Rubio and a bipartisan group of senators have complained about specific companies included in the MSCI All Country World ex-U.S. Investable Market Index, which gives a 7.5% weighting to Chinese firms.
The U.S. lawmakers say the targeted companies “assist in the Chinese government’s military activities, espionage, and human rights abuses, as well as many other Chinese companies that lack basic financial transparency.”
The lawmakers called on the Federal Retirement Thrift Investment Board (FRTIB) to reverse its decision and use the index provided Thrift Savings Plan’s (TSP) International Stock Fund.
Rubio said in a statement emailed to the press:
Its clear the Board will not act in the best interests of the United States, reverse this misguided decision and protect our national interest, as well as those who serve it. That’s why I will be introducing bipartisan legislation to ensure that federal retirement savings can never be a source of wealth funding the Chinese Communist Party at the expense of our nation’s future prosperity.
The board said it will reconsider the matter at a November 13 meeting.
“The TSP is a retirement savings plan for federal employees and members of the military,” Reuters reported. “As of July 2019, TSP assets totaled around $599.5 billion.”
“MSCI previously responded to Rubio’s criticisms, saying there was no U.S. law prohibiting an index company from creating an index containing Chinese securities,” Reuters reported.
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