BlackRock responds to Soros’ criticism of its investments in China

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Jack Otter addresses the topic with a panel on the ‘Barron Roundtable’

Hedge fund mogul George Soros condemned BlackRock’s recent $ 1 billion investment in China in an op-ed published Monday by the Wall Street Journal.

Soros called BlackRock’s recent move to bring mutual funds to the country last month a “tragic mistake” which he said is “likely to lose money for BlackRock clients and … harm the national security interests of the United States and other democracies. “

“The United States and China have an important and complex economic relationship,” a BlackRock spokesperson said in response. “Total trade in goods and services between the two countries exceeded $ 600 billion in 2020. Through our investing activity, US-based asset managers and other financial institutions are contributing to the economic interconnection of the two largest economies in the world.

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After introducing mutual funds in China, the company asked its clients to invest in the country, pumping billions of dollars into the world’s second-largest economy.

It is the first foreign-invested asset management company based outside of China to receive approval from Chinese President Xi Jinping to start a mutual fund business in the country, according to Reuters.

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“The overwhelming majority of assets managed by BlackRock are for retirement. BlackRock clients around the world – including many US clients – are looking for a wide range of investments, including in China, to achieve their retirement and other financial goals, ”the spokesperson said, adding that China “is taking action to deal with its growing pension crisis.”

Blackrock believes he can help China “meet this challenge by providing … pension system expertise, products and services.”

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“We believe that globally integrated financial markets provide individuals, businesses and governments of all countries with better and more efficient access to the capital that supports economic growth around the world,” the spokesperson said. word.

Soros, however, believes U.S.-Chinese relations are on shaky ground with the world’s two largest economies “engaged in a life-and-death conflict between two systems of governance: repressive and democratic,” and that the investment from BlackRock in the country “will help support President Xi’s regime.”

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The billionaire specifically targeted Blackstone co-founder Stephen Schwarzman and former Goldman Sachs chairman John L. Thornton for jumping at “the prospect of business opportunities offered by Mr. Xi.”

He concluded by calling on the Securities and Exchange Commission “to limit the flow of funds to China”.

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