Russia’s invasion of Ukraine ended globalization as we know it, says the head of BlackRock, the world’s largest asset manager.
BlackRock CEO Larry Fink told shareholders in a letter on Thursday that Russia’s “decoupling from the global economy” following its attack on Ukraine has prompted governments and companies to scrutinize their dependence on other nations.
“The Russian invasion of Ukraine put an end to the globalization we have experienced over the past three decades,” Fink wrote.
The CEO, whose company manages $10 trillion in assets, predicted that Russia’s isolation “will lead companies and governments around the world to reassess their dependencies and re-analyze their manufacturing and assembly footprints.”
But some countries could benefit by focusing on building their domestic industries, such as onshore companies or “nearshore” from their operations, he said.
Fink said the coronavirus pandemic had already started this movement
At the start of the pandemic, countries struggled to secure desperately needed Chinese-made personal protective equipment. As economies reopened—and demand soared—supply chain bottlenecks helped push inflation to levels not seen in decades.
A shortage of semiconductor chips, in particular, has affected industries over the past year, from automakers to technology companies.
And now Russia’s attack on Ukraine — followed by swift, punitive Western sanctions, and a series of corporate exits — has disrupted international export markets.
The price of Brent crude, the global benchmark, surged above $139 a barrel in early March as buyers feared supply shocks, although crude has since fallen.
“Energy security has joined the energy transition as a top global priority,” said Fink.
While Fink predicts coal consumption could increase next year as Europe and Asia try to get rid of Russian oil and gas, rising energy prices are likely to make renewables more competitive, he said. .
“In the long term, I believe recent events will really accelerate the shift to greener energy sources in many parts of the world,” Fink wrote.
Source: CNN Brasil
I am Sophia william, author of World Stock Market. I have a degree in journalism from the University of Missouri and I have worked as a reporter for several news websites. I have a passion for writing and informing people about the latest news and events happening in the world. I strive to be accurate and unbiased in my reporting, and I hope to provide readers with valuable information that they can use to make informed decisions.
