U.S. President Donald Trump is mulling a ban against the federal government’s retirement savings fund from investing in Chinese equities due to national security risks.
$50 billion were set to be transferred from the U.S. Thrift Savings Plan (TSP) to mirror an MSCI index that covers a broad universe of developed and emerging markets. According to a «Bloomberg» report citing unnamed sources, President Trump is considering options to block the transferal, scheduled for mid-2020, amidst an increasingly bearish stance against China.
The move could be delivered as an executive order, the report added, but no decision had been finalized at the time.
TSP Response
According to a spokesperson for the TSP, the move to mirror the index was in line with other U.S. 401(k) programs and cited major corporations such as Microsoft, Boeing and Lockheed as others that also used the same index.
«The FRTIB has long held the view that the Office of Foreign Asset Control is the appropriate arm of the federal government to determine legal foreign investments for all Americans,» the spokesperson added.
