Ding Xuedong named Chairman of China Investment Corporation

Also Deputy Secretary-General of the State Council.

China Investment Corporation is China’s sovereign wealth fund. Ding’s appointment comes at a time when the prospect of the U.S. Federal Reserve reducing stimulus is unsettling global markets. CIC was established in 2007 to boost yields on China’s foreign-exchange reserves.

Ding faces the prospect of rising interest rates after the Fed said bond purchases that have buoyed assets worldwide might end in 2014 if the U.S. economy grows according to Fed expectations.

The U.S. and Canada accounted for 44% of CIC’s diversified equity investments in 2011, and held 62% of its fixed-income portfolio in government bonds.

CIC achieved an 11% investment return on its overseas portfolio last year compared to a loss of 4.3% in 2011, It met government expectations by delivering 5% annualized returns since its creation.

Ding succeeds Lou Jiwei, who boosted holdings of resources-related companies and bolstered long-term portfolio and private-equity assets.