Louisiana Treasurer Urges Divestment from Chinese Investments

BATON ROUGE, La. (KPEL News) — Louisiana State Treasurer John Fleming is urging the state’s ten public retirement systems to divest over $1.012 billion currently invested in Chinese stocks and bonds, warning that such holdings pose serious national security and financial risks.

Tied to Trump’s "America First Investment Policy"

Fleming’s letter, sent May 13, follows President Donald Trump’s February 2025 executive order declaring the People’s Republic of China (PRC) a foreign adversary. Under the new America First Investment Policy, the president ordered a review of U.S. capital flowing into Chinese ventures, especially those supporting China’s military-civil fusion strategy.

Fleming echoed that concern, warning that Chinese firms may be using American retirement dollars to fund technologies with military applications.

“Due to the threat posed by Communist China and President Trump’s Executive Order, I recommend our systems carefully and methodically remove their existing Chinese market holdings and discontinue any new investments,” Fleming wrote.

Credit: TSM Media Center/Igor Ilnitckii

Nine Key Risk Factors Identified

In his letter to pension boards, Fleming laid out nine reasons why Chinese investments pose an unacceptable risk to Louisiana’s public retirement funds:

Lack of financial transparency
Chinese Communist Party market manipulation
Illiquidity and volatile markets
Exchange rate instability
Limited regulatory oversight
Declining Chinese economy and geopolitical tensions
Human rights abuses
Ongoing political and social unrest
State-sponsored intellectual property theft

Fleming emphasized that Chinese markets do not follow U.S. financial standards and are often shielded from external review—putting Louisiana retirees’ assets at long-term risk.

Fleming Recommends U.S.-Based Reinvestment

In addition to calling for divestment from China, Fleming advised state retirement systems to avoid investing in any other communist countries and instead consider U.S.-based equities.

He characterized this as a strategic shift that supports both fiscal prudence and American values.

“This isn’t just about money,” said Fleming. “It’s about national security and doing what’s right with the public’s trust.”

What Happens Next?

The decision now lies with the boards of Louisiana’s state retirement systems, which must weigh the treasurer’s recommendation against long-term investment strategies. The move signals a broader national conversation on pension fund accountability in the face of global instability.