China is increasingly emphasizing long-term, patient capital as a cornerstone of its next stage of economic growth, a strategy gaining attention following Warren Buffett’s recent retirement from Berkshire Hathaway, which he grew into a US$1 trillion enterprise over six decades.
This approach, echoing Buffett’s value investing philosophy, aligns with Beijing’s broader economic objectives amid ongoing tensions between the United States and China. The US-China leadership summit this week is being closely watched by global investors for potential signs of reduced friction and renewed appetite for Chinese assets.
“The long-term return nature of Berkshire’s philosophy coincides with China’s economic philosophy,” said Tommy Ong, managing director of Hong Kong-based T.O. & Associates Consultancy. Wu Qing, chairman of the China Securities Regulatory Commission, underscored this alignment, stating that Buffett’s principles of long-term value investing and rational decision-making remain relevant regardless of his retirement.
China is actively reforming its mutual fund industry, valued at approximately US$4.5 trillion, to discourage short-term speculation and encourage longer holding periods. According to Bruno S. Sergi, a Harvard University instructor specializing in development economics and emerging markets, China views long-term value investing not merely as an investment strategy but as a national financial priority. Policymakers aim to direct capital toward sectors such as advanced manufacturing, electric vehicles, and broader industrial upgrading.
Berkshire Hathaway’s investment decisions illustrate the practical application and challenges of this philosophy. Last year, the firm exited its 17-year stake in BYD, turning an initial investment of about US$230 million into returns exceeding twentyfold—marking one of the most profitable foreign investments in Chinese companies.
However, Berkshire’s exit from Taiwan Semiconductor Manufacturing Company (TSMC) shortly after acquiring a multibillion-dollar stake in late 2022, followed by increased holdings in Japanese trading houses, signals a degree of caution related to geopolitical considerations rather than a direct indictment of China’s investment climate. Buffett himself noted in April 2023 that geopolitical tensions influenced the decision to sell TSMC shares.
Nonetheless, this high-profile divestment has intensified concerns among foreign investors about political risks and the shrinking pool of new Chinese listings. Kevin Chen Kaifeng, chief economist at Horizon Financial in New York, highlighted this trend, noting that while roughly 50 to 60 Chinese companies listed in the United States each year in 2024 and 2025, only two have done so so far this year, limiting investor options.
Despite these challenges, some major investors are increasing their exposure to Chinese equities. David Lepper of Appaloosa Management nearly doubled his stake in Baidu to about US$148 million during the last quarter. Meanwhile, Stanley Druckenmiller’s Duquesne Family Office re-entered the Chinese market after more than two years by purchasing US$10 million in Baidu shares.
As China seeks to balance fostering long-term investment with geopolitical realities, its commitment to patient capital may play a pivotal role in shaping its economic trajectory in the coming years.