Low ROE could hurt China's funding of its pension deficit

China has a problem. It has massive pension liabilities, estimated at 60-80% of GDP, or $600-800 billion, and listed state owned enterprises which show a dismal return on equity (ROE). The interim results of Chinese listed companies showed ROE of just 4.1% this year, down from 5% at the same point last year, according to research from emerging markets investment bank CLSA. "To provide for our liabilities, we would typically look at an investment yield of around 10% per year," commente…