The Canada Pension Plan Investment Board has laid off at least five investment professionals at its Hong Kong office as it steps back from deals in China, according to a report by Reuters.

Most of the employees were on the fund’s private equity team and were informed early last month, said the report, citing three individuals with knowledge of the matter and who declined to be identified. The CPPIB has paused new investments in China, including direct investments as well as those in China-focused fund managers, discouraged by the country’s faltering economic recovery and tensions with the West, according to the report.

In its latest annual report, the CPPIB noted evolving relationships between Canada, the U.S. and China would be a factor as it reviewed its approach to emerging markets.

Read: Parliamentary subcommittee investigating Canadian public sector pension allocations to China

China accounts for 9.8 per cent of the CPPIB’s total investments, said Michel Leduc, a senior managing director at the CPPIB, speaking before a parliamentary committee studying Canada-China relations in May. At the time, he said China was an “important source” for the CPPIB’s portfolio.

Other Canadian pension funds are also pulling back from China. In April, the Ontario Teachers’ Pension Plan closed down its Hong Kong-based China equity investment team, while the Caisse de dépôt et placement du Québec also stopped making private deals in China and will close its Shanghai office this year, the Financial Times reported in June.

Read: Ontario Teachers’ to manage Asian public equities investments in Toronto