George Soros calls BlackRock’s investment in China a “tragic mistake” | Business and Economic News

BlackRock is the world’s largest fund management company; last month, it began to provide investment products to Chinese individuals.

George Soros criticized BlackRock’s China measures as a risk to customer funds and US security interests. This is a recent attack by the billionaire financier and philanthropist against investing in the world’s second largest economy.

“It is a tragic mistake to invest billions of dollars in China now,” Soros wrote in a Wall Street Journal column. “For BlackRock customers, this is likely to suffer losses, and more importantly, it will harm the national security interests of the United States and other democracies.”

BlackRock is leading the global advancement into China’s asset management industry. The world’s largest fund management company began offering investment products to Chinese individuals last month, two months after it was approved to become China’s first wholly foreign-owned mutual fund company.

This comment is one of several that Soros has written in recent weeks, warning against Xi Jinping’s China in a series of repressive waves of market turmoil. Soros condemned Xi Jinping as “the most dangerous enemy of an open society in the world” in another journal column last month, and then argued in the Financial Times that Congress should pass legislation to limit investment by asset management companies to “The actual governance structure is transparent and consistent with stakeholders.”

In a recent article, Soros stated that BlackRock seems to have misunderstood Xi Jinping. He said that Xi Jinping’s government views all Chinese companies as “tools of a one-party state.”

The different views of the two most influential fund managers in the world underscore the increasingly tense environment facing financial companies in Asia’s largest economies. Although Xi Jinping has made it easier for foreign investors to participate in the domestic market, his government is also strengthening its control over the private sector and clashed with the United States on everything from cyber security to human rights violations in Xinjiang.

Soros said that the restrictions that began with the abrupt cancellation of the Ant Group’s initial public offering last year have “reached a climax.” He cited actions against ride-hailing company Didi Global a few days after listing in New York, as well as the crackdown on “US-funded” Chinese tuition companies. Soros also said that BlackRock’s managers must be aware that “China’s real estate market is brewing a huge crisis.”

Although Soros is still an influential supporter of US President Joe Biden’s Democratic Party, he no longer manages external funds and is currently only a minority voice on Wall Street. BlackRock, Goldman Sachs and most of their major counterparts in the treasury management and banking industries believe that China’s opportunities outweigh the risks.

Soros said: “Today, the United States and China are involved in a life-and-death conflict between two governance systems: repressive and democratic.”