FPI / May 1, 2024
BlackRock, the Wall Street firm which manages the retirement assets of millions of Americans, is heavily invested in China’s nuclear weapons buildup as well as multiple Chinese military-linked firms, according to a think tank’s shocking report to Congress.
BlackRock insists that it does not do business with companies in China which produce nuclear arms, but the report by the Coalition for a Prosperous America states: “The reality is that BlackRock holds stock in Chinese companies pursuing an aggressive buildup of nuclear warheads meant to hold United States territory at risk.”
China’s nuclear expansion has been called a “breakout” and the largest buildup of nuclear weapons since the Cold War.
The report also singled out MSCI Inc., a leading provider of support tools for global investors known as indexes, for its role in BlackRock’s investments in banned military-linked companies in China.
BlackRock has invested millions of dollars in an estimated 30 Chinese military-linked companies currently sanctioned by the U.S. government, according to the think tank’s report.
A congressional committee’s report last year said MSCI, described as the world’s leading index provider, and BlackRock, dubbed the world’s largest asset manager, funneled $3.7 billion and $1.9 billion, respectively, into Chinese companies which are banned in the U.S.
In total, major financial institutions provided $6.5 billion to 63 companies linked to Chinese military enterprises or those involved in human rights abuses, the congressional report said.
Roger W. Robinson, former chairman of the congressional U.S.-China Economic and Security Review Commission, said the new report should prompt Congress to take action, according to security correspondent Bill Gertz writing about the report for the Washington Times.
“The callous disregard for national security and human rights-related risk — much less the abuses of these Chinese corporate bad actors — together with the lack of fiduciary responsibility and diligence on display in this report is very troubling,” Robinson said. “
The think tank’s report contended that BlackRock has been able to circumvent U.S. sanctions law by offering investment products through foreign subsidiaries, including Hong Kong-based BlackRock Asset Management North Asia Limited. In mainland China, BlackRock is represented by BlackRock Fund Management Company, a wholly owned mutual fund company in Shanghai.
“These subsidiaries together own stock in 14 companies on the Treasury Department’s Chinese Military-Industrial Complex List that U.S. individuals and corporations are not permitted to trade,” the report said.
BlackRock has invested about $36 million in four subsidiaries of the Aviation Industry Corporation of China (AVIC), China’s largest defense contractor building warplanes, including the J-20 and FC-31. The aircraft “would be on the frontline of a regional conflict with the United States,” the report said.
BlackRock also has invested more than $50 million in affiliates of the China Shipbuilding Industry Company (CSIC), which is building warships and submarines, including aircraft carriers and JIN-class ballistic missile submarines.
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