China plans to encourage insurance funds into stock markets.

BEIJING (Reuters) – China said on Wednesday it would direct large state insurance and commercial insurance funds to increase investments in the A-share market to boost a sluggish stock market.

The plan, jointly announced by six financial regulators, including the securities regulator, calls for large state-owned insurance companies to increase both the volume and size of their investments in mainland and equity-listed Chinese stocks.

The regulators apply a long-term performance review of state-owned insurance companies, with an annual return on equity not exceeding 30% of the review and at least 60% over a longer three- to five-year cycle.

The plan came as Chinese stocks rallied in 2018. US President Donald Trump is expected to impose heavy tariffs on Chinese goods in 2025, putting further pressure on the already sluggish economy.

The plan will increase the investments of China’s National Social Security Fund and Pension Fund into the stock market.

It also leads mutual fund managers to continuously increase the amount and size of equity funds under management.

China has announced several measures to boost investor confidence and revive its stock market. Among measures taken to support capital markets in the past few months, authorities have announced swap and buyback plans totaling 800 billion yuan for share buybacks.

(Reporting by Zhi Tang, Yukun Zhang and Ryan Wu; Editing by Jacqueline Wong and Alison Williams)