China's sovereign wealth fund China Investment Corp has appointed a new general manager at a time of rising turbulence in global financial markets that is challenging the country's management of foreign exchange reserves.

Tu Guangshao, the deputy mayor of Shanghai, will replace Li Keping, who has served as CIC's general manager for two years, Liberation Daily, the official Shanghai Municipality newspaper, reported on Tuesday.

Tu, 57, a promoter of Chinese financial market liberalization, has extensive experience in financial regulation and risk management.

He has served in several key positions, including as deputy chairman of the China Securities Regulatory Commission and general manager of the Shanghai Stock Exchange.

An expert said the new CIC head will face a greater challenge in striking a fine balance between ensuring investment returns on its overseas portfolio while guarding against turmoil in global markets.

Wu Qing, a financial researcher at the State Council's Development Research Center, said: "As a big sovereign wealth fund, CIC cannot adopt too radical a strategy. It has to actively adjust its investment approach in a more volatile environment while taking advantage of a weaker yuan to boost the value of its overseas assets."

CIC, which had assets worth $746.7 billion in 2014, has achieved a yearly average investment return of 5.66 percent since being established in 2007. Its total assets rose by 14.3 percent in 2014 from a year earlier, according to its annual report last year.

It was set up by the central government with the goal of diversifying China's foreign exchange reserves, which stood at $3.2 trillion in March.

Tu supports financial innovation and new ideas, Tencent Finance, an online business news outlet, cited people close to him as saying.

He pushed for an international board at the Shanghai Stock Exchange designed to enable foreign companies to float shares on the Chinese capital market.

Li is stepping down as CIC head as he has reached retirement age, the report said.

lixiang@chinadaily.com.cn