The world’s biggest asset manager said on September 8, 2021, that the fund was officially set up this week and has attracted over 111,000 investors. BlackRock has now raised 6.68 billion yuan. The new investment fund in China, which is the first to be owned wholly by a foreign company has already attracted at least $1 billion from the Chinese investors in its first week.
BlackRock started offering investment products to individual Chinese investors late in August. The asset manager’s chair and head of Asia Pacific, Rachel Lord, said in a statement:
“We are very proud of achieving this milestone for our China fund management business, and are grateful for investors’ overwhelming support.”
George Soros Criticizes BlackRock’s ‘China Blunder’
BlackRock’s statement and announcement came several days after the firm was blasted by billionaire philanthropist George Soros for the recent efforts in China. He referred to BlackRock’s move into the Chinese market as a “blunder.”
The asset manager’s new product launch came barely weeks after it recommended that investors should pile their investments into Chinese assets. Soros, a longtime critic of Xi Jinping, highlighted in an op-ed published on September 6 by the Wall Street Journal:
“Pouring billions of dollars into China now is a tragic mistake. It is likely to lose money for BlackRock’s clients and, more importantly will damage the national security interests of the [United States] and other democracies.”
Soros said that Xi’s recent massive crackdown on private business is proof that:
“the regime regards all Chinese companies as instruments of the one-party state.”
He also referred to a massive crisis that is developing in China’s real estate market and Jinping’s efforts to redistribute wealth. According to Soros, these trends do not go well for foreign investors.
George Soros also believes that BlackRock’s initiative is a major threat to the democracies since:
“The money invested in China will help prop up President Xi’s regime, which is repressive at home and aggressive abroad.”
BlackRock is yet to comment about the Soros publication. But previously, CEO Larry Fink has insisted that he believes the Chinese market is a huge opportunity that cannot be ignored. On September 8, the company confirmed its intention to stay in China for the long term.
BlackRock Fund Management’s general manager, Chi Zhang, said in a statement:
“We are very pleased with the official establishment of our first mutual fund in China. The support and trust from our investors and distribution partners have been extremely encouraging.”
While Soros has mentioned some real concerns that exist among investors about the way Beijing has been cracking down on sectors including technology and technology and the effect in the long term, heavyweight global investment companies want to remain in China for now.
Fidelity, Pictet, and Goldman Sachs are the other major companies that are advising their clients to remain invested in the Chinese market, although cautiously.