Hedge Fund Titan George Soros Throw Rock at BlackRock over China Risk

Posted on 09/07/2021


BlackRock Inc. is the world’s largest asset manager and for over a decade has courted China, trying to gain access to manage their capital both retail and institutionally. In December 2016, BlackRock was awarded its first Renminbi Qualified Foreign Institutional Investor (RQFII) license in the United States by the China Securities Regulatory Commission (CSRC). This is the first RQFII license awarded to any asset manager in the U.S. and the fourth RQFII license awarded to BlackRock.

Furthermore, BlackRock’s research team has acknowledged the strategic rivalry between the U.S. and China in its May 2021 research called “The role of Chinese Assets”. On August 30, 2021, BlackRock pushed a series of mutual funds and investment products for Chinese retail investors. China is the world’s second-largest economy.

“The Chinese market represents a significant opportunity to help meet the long-term goals of investors in China and internationally,” BlackRock Chairman Larry Fink wrote in a letter to shareholders.

George Soros
Hedge fund titan George Soros scathed BlackRock in an op-ed in the Wall Street Journal called “BlackRock’s China Blunder”. Soros critiques BlackRock’s China as a risk to clients’ money and U.S. national security interests. Soros is concerned about the Chinese Communist Party’s crackdown on private businesses.

Soros wrote that “BlackRock recommended that investors triple their allocations in Chinese assets. This will push billions of dollars into China.”

“Pouring billions of dollars into China now is a tragic mistake,” Soros typed in an op-ed in the Wall Street Journal. “It is likely to lose money for BlackRock’s clients and, more important, will damage the national security interests of the U.S. and other democracies.”

Soros believes BlackRock’s initiative is a threat to democracies because “the money invested in China will help prop up President Xi’s regime, which is repressive at home and aggressive abroad.”

Background
In January 2016, Soros publicly changed his tune on China, criticizing Chinese President Xi Jinping and painting China as a gloomy picture.

In December 2018, the Hong Kong Securities and Futures Commission fined SFM HK Management Ltd., Soros Fund Management LLC’s Hong Kong unit, HK$ 1.5 million for naked short selling regarding Great Wall Motor Co. Ltd.

Keywords: Soros Family Office.

WSJ Op-Ed: https://www.wsj.com/articles/blackrock-larry-fink-china-hkex-sse-authoritarianism-xi-jinping-term-limits-human-rights-ant-didi-global-national-security-11630938728

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