What BlackRock will do (and what it won’t do) between Saudi Arabia and China
BlackRock has announced an investment deal with Saudi Arabia's sovereign wealth fund, but has suspended the launch of an ETF in China. All the details
BlackRock, the largest asset management company in the world, has signed an agreement with the Saudi sovereign wealth fund Public Investment Fund for the financing of infrastructure in the Middle East.
The investments will concern projects in the energy, water, utilities, transport and telecommunications sectors. The first partnership between the US company and the Saudi fund concerns the development of waste management projects in the Middle East region, which will be developed and managed by the Saudi Investment Recycling Company (SIRC), a subsidiary of the Public Investment Fund.
– Read also: Why JpMorgan and Goldman Sachs do not want to give up business with Saudi Arabia
THE NEOM MAXI-PROJECT ON GREEN HYDROGEN
Meanwhile, financing of the major Saudi green hydrogen project Neom could be completed in the coming months, reports Bloomberg .
Located in the northwest of the kingdom, worth $5 billion, it could be one of the largest plants in the world for the production of fuel from renewable electricity. Construction has already begun and is expected to finish in 2026, as planned. So far, the project's partners – including Saudi energy plant company ACWA Power and US chemical company Air Products – have invested around $900 million.
The green hydrogen market is estimated to be worth $700 billion annually by 2050, although the technology for its large-scale production has not yet established itself commercially. Saudi Arabia wants to exploit its wind and solar potential to become a major exporter of this fuel, which could allow the decarbonisation of non-electrifiable heavy industries and transport.
WHY BLACKROCK SUSPENDS PLANS ON CHINA
The Financial Times reported Sunday that BlackRock has indefinitely postponed the launch of an exchange-traded fund (ETF) that invests in Chinese bonds, due to the strong political and economic tensions between the United States and China.
According to the newspaper, the company feared becoming involved in a dispute with the Washington authorities, who could have intervened to prevent American capital from going to finance the Chinese government.
Reuters previously reported that BlackRock's China ETF was expected to launch in the fourth quarter of 2022 and would add more than $1 billion worth of assets to what the company already manages through two mutual funds containing stock investments. Chinese and Hong Kongers.
WHO CONTESTS BLACKROCK IN THE UNITED STATES
In addition to its relations with Beijing , in the United States BlackRock is already contested by several conservative or moderate states – such as Texas , Louisiana and Arizona – due to its environmental and social sustainability strategies (ESG, in jargon ).
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/economia/blackrock-arabia-saudita-cina/ on Mon, 14 Nov 2022 13:26:16 +0000.