China remains major growth area in Asia-Pacific region, JPMorgan executive says

China will become one of the "outsize contributors" to JPMorgan Asset Management's five-year plan to double Asia-Pacific assets under supervision to about US$600 billion, according to the firm's top executive in the region.

"Our long-term goal is to grow [operations in the region] to a US$1 trillion business," said Dan Watkins, CEO of Asia-Pacific at JPMorgan Asset Management, in an interview on Tuesday.

He said China, Australia and Japan - the three largest capital markets where the US firm operates - would support its growth plan. Assets under management across seven markets in the region already crossed the US$300 billion mark, double the amount from 2019.

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"China is a significant long-term strategic priority for us," Watkin said. "I fundamentally believe in the long-term prospects of our onshore China asset-management business."

That operation would account for "a huge part" of the company's regional and global business, he added, without providing specific numbers.

Watkin's assessment reflects how global investors are increasingly turning to major Chinese firms in the technology and energy sectors to diversify their investment portfolios amid heightened geopolitical tensions.

Men walk past a screen showing Chinese stock market movements at a securities company in Beijing on April 8, 2025. Photo: AFP alt=Men walk past a screen showing Chinese stock market movements at a securities company in Beijing on April 8, 2025. Photo: AFP>

Exchange-traded funds (ETFs) would be a growth area amid increased interest in China equities among international and Chinese retail investors, according to Watkins.

"At the moment, one of the most successful products onshore in China is ETFs, so we're building that product capability to meet that investment need," he said.

China's ETF market in August reached more than 5 trillion yuan (US$700.2 billion) in market value, up from 4 trillion yuan in four months, according to Morningstar data.

The country surpassed Japan to become the largest ETF market in the Asia-Pacific region, which showed its potential to help international investors diversify their portfolios and secure steady returns.

JPMorgan Asset Management, which took full ownership of its China joint venture with Shanghai International Trust in 2023, had about US$4.5 billion invested in 10 ETFs listed in China, said Philippe El-Asmar, the firm's head of Asia-Pacific ETF business, in a separate interview.

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The company aimed to triple its assets under management in three years and multiply the figure by six in five years, with "a big part" coming from China ETFs, El-Asmar said.

So-called active ETFs - typically managed with additional research, security selection and portfolio construction elements - would be a future focus for JPMorgan Asset Management in China, where such products had limited adoption owing to regulatory constraints.

"Offering passive ETFs into China is, frankly, to get familiar with investors recognising us as an ETF provider," Watkins said. "So when and if the regulation changes, we'll be ready to bring active ETFs to the China market."

JPMorgan Asset Management planned to do more with the cross-border connectivity schemes between mainland China and Hong Kong, such as the mutual fund recognition programme and Wealth Connect, he added.

"If these cross-border programmes continue to evolve, then they are great opportunities for investors and for asset-management companies," Watkins said.

As JPMorgan Asset Management's Asia-Pacific headquarters, Hong Kong would play an important role in product innovation and attracting investments, according to Watkins. He said most of the firm's 155 investment professionals in Asia are based in the city and serve as "the engine room of the business".

Capital flows into Hong Kong's investment products rose sharply over the past two years - with gross flow climbing to US$62 billion this year from US$45 billion in 2024 and US$27 billion in 2023. That reflected stronger retail participation and more active capital movement, Watkins said.

On potential hiring in the city, Watkins remained open-minded. "If our business continues to grow - which it has been doing - then I get great support from our leadership, and we will have the resources needed to serve our clients," he said. The firm currently has around 1,500 people in the Asia-Pacific region.

This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2025 South China Morning Post Publishers Ltd. All rights reserved.

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