Billionaire Investor Mark Mobius Says China is Restricting Flows of Capital Out of The Country
Billionaire investor Mark Mobius told Fox Business he cannot take his money out of China due to the country’s capital controls, cautioning investors to be “very, very careful” about investing in an economy under a tight government grip.
“I have an account with HSBC in Shanghai,” Mobius, founder of Mobius Capital Partners, told Fox Business in an interview published on March 2. “I can’t take my money out. The government is restricting flow of money out of the country.”
Mobius’ comments were circulated on Chinese social media site WeChat over the weekend, at the same time as China’s Two Sessions annual parliamentary meetings, which reveal the nation’s policies for the coming year.
“I can’t get an explanation of why they’re doing this … They’re putting all kinds of barriers,” Mobius said. “They don’t say, ‘no, you can’t get your money out’. But they say, ‘give us all the records from 20 years of how you made this money’ … This is crazy.”
Mobius led emerging market investment at Franklin Templeton Investments for three decades and is known for his bullish views on China. Now, though, he said, he “would be very, very careful” investing in the country.
“The bottom line is that China is moving in a completely different direction than what Deng Xiaoping instituted when they started the big reform programme,” he said, referring to the former Chinese leader.
“Now you have a government which is taking golden shares in companies all over China. That means they’re going to try to control all of these companies … So I don’t think it’s a very good picture when you see the government becoming more and more control-oriented in the economy.”
Mobius, who calls himself “the Indiana Jones of emerging market investing”, told Fox Business he is increasing exposure to alternative markets such as India and Brazil.
Mobius and HSBC could not be reached at the weekend.
Mobius, 86, is known to the public as the “father of emerging markets” as he has over 30 years of experience investing in emerging markets. Typically these are prone to higher volatility but also higher returns than developed markets. Mobius was one of the early birds to invest in developing economies in Asia and mainland China.
Just a few months after stepping down as chairman of Templeton Emerging Markets Group in January 2018, he co-founded a new asset management company called Mobius Capital Partners with two other veteran managers, Carlos Hardenberg and Greg Konieczny.
The two sessions is where the two main political bodies of China – the National People’s Congress (NPC) and the National Committee of the Chinese People’s Political Consultative Conference (CPPCC) – reveal plans for China’s policies involving the economy, military, trade, diplomacy, the environment and more. The event began on Sunday with Premier Li Keqiang reading out the last government work report under his watch. He is expected to be succeeded by Li Qiang at the end of the legislative session.
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