BlackRock’s Shanghai-based unit, the BlackRock China New Horizon Mixed Securities Investment Fund, has raised 6.7 billion yuan – just short of its 8-billion-yuan (US$1.24 billion) cap – as it readies to kick off investments for clients in China.
BlackRock’s billion-dollar news comes just days after George Soros blasted the company’s involvement in China.
In a recent op-ed in The Wall Street Journal, Mr Soros branded the giant’s decision to launch a billion-dollar mutual fund as a threat to “national security interests of the US and other democracies”, calling it a “tragic mistake”.
BlackRock introduced its own mutual fund to Chinese consumers late last month via a newly established local subsidiary in Shanghai, becoming the first foreign-owned company allowed to do so.
The move came shortly after the company’s chairman Larry Fink touted growing markets, like China, as the chalice for people seeking financial wellbeing.
“The Chinese market represents a significant opportunity to help meet the long-term goals of investors in China and internationally. It also provides us an opportunity to help address the challenge of retirement for millions of people in China,” Mr Fink said in a letter to shareholders.
“We are in the final stages of receiving regulatory approvals to set up a wholly-owned fund management company and an asset management joint venture with China Construction Bank and Temasek. As BlackRock deepens its partnerships and grows its presence in China, I am optimistic that we can help create a better future for more people,” he continued.
Not only does Mr Fink believe a globally integrated market could help support economic growth around the world, but he is confident BlackRock could help China address its retirement challenges.
But Mr Soros doesn't quite agree. He is of the opinion that Mr Fink, Stephen Schwarzman – the co-founder of Blackstone – and John Thornton – former Goldman Sachs president – are merely jumping at business opportunities “dangled by” Chinese President Xi Jinping.
“Earlier efforts could have been morally justified by claims that they were building bridges to bring the countries closer, but the situation now is totally different. Today, the US and China are engaged in a life and death conflict between two systems of governance: repressive and democratic,” Mr Soros said.
According to Reuters, China's mutual fund market is expected to grow to 60 trillion yuan ($8.75 trillion) in a decade.
Maja Garaca Djurdjevic
Maja's career in journalism spans well over a decade across finance, business and politics. Now an experienced editor and reporter across all elements of the financial services sector, prior to joining Momentum Media, Maja reported for several established news outlets in Southeast Europe, scrutinising key processes in post-conflict societies.
