California pension system invested more than $490 million in Chinese state-owned companies: report

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California’s public pension system (CalPERS) has more than $3 billion tied up in Chinese companies, including 14 state-owned enterprises blacklisted by the Trump administration because of their ties to the Chinese military, according to a report Thursday.

Records reviewed by The Washington Free Beacon reportedly show that CalPERS had more than $450 million invested in the 14 companies blacklisted by the previous administration. More than $490 million were invested in other seven of companies owned by the Chinese government, which are reportedly funding the state’s Belt and Road Initiative.

While those weren’t blacklisted by the previous administration, the other 14 raised questions about California’s compliance with the executive order signed by President Trump.

One of those – China Communications Construction Company (CCCC) – is also state-owned and has reportedly flouted international agreements by building military installations in the South China Sea. CalPERS invested $6 million in the company, which faced intense criticism from former Secretary of State Mike Pompeo in Aug. of 2020.

“CCCC led the destructive dredging of the PRC’s [People’s Republic of China’s] South China Sea outposts and is also one of the leading contractors used by Beijing in its global ‘One Belt One Road’ strategy,” he said. “CCCC and its subsidiaries have engaged in corruption, predatory financing, environmental destruction, and other abuses across the world.”

“The PRC must not be allowed to use CCCC and other state-owned enterprises as weapons to impose an expansionist agenda,” he added.

CalPERS, which has $400 billion in assets under management, also invested $3.7 million in China Merchants Port and $110 million in CITIC. Those two reportedly own ports used in military exercises by the People’s Liberation Army. 

CalPERS declined to comment when contacted by Fox News. Details came from the entity’s 2020 investment report with some investments occurring as early as 2016.

Thursday’s report raises questions about Gov. Gavin Newsom’s support for China as he approaches a recall election on Sept. 14. Newsom assumed office in 2019 but served as lieutenant governor since 2011.

He previously called on CalPERS to divest from Turkish companies over a refusal to recognize the Armenian genocide. And in urging divestment from tobacco companies, he said the state pension system would be “investing in death.” 

In a statement to Fox News, former San Diego Mayor Kevin Faulconer blasted Newsom’s administration.

“It’s outrageous that Gavin Newsom’s administration would allow hundreds of millions of dollars from California’s pension system to be invested into the totalitarian Chinese communist government’s entities,” said Faulconer, a Republican whose running to replace Newsom. “This demands immediate answers from Newsom and further shows why he can no longer be trusted to lead. We are going to recall him on September 14 and I look forward to cleaning up this mess when I am elected Governor.”

Newsom recently attracted attention for praising a Chinese outlet with ties to the country’s Communist Party.

During the annual gala for Sing Tao Daily, Newsom appeared to thank Editor-in-Chief Joseph Leung for his staff’s “balanced” coverage.

“Joseph, your work has been a labor of service – not only to the Chinese American community throughout the Bay Area but all throughout Northern California community as well. I want to commend you and your incredible staff, your leadership team at Sing Tao Daily for your dedication to journalistic integrity and for providing balanced news stories to Chinese Americans and beyond.”

He later added: “You represent the best of California and you remind us, as always, that diversity is our strength.”

Newsom’s office did not immediately respond to Fox News’ request for comment.

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