Thursday, December 19, 2024

Fink Sees ‘Dawning of Infrastructure’ Fueling Economic Growth

Must read

(Bloomberg) — BlackRock Inc. Chief Executive Officer Larry Fink said infrastructure is a major component to help stimulate growth in every economy and there’s enough capital in the private sector to fund investment.

Most Read from Bloomberg

“To me, this is the dawning of infrastructure,” he told Bloomberg Television’s Francine Lacqua in an interview Tuesday on the sidelines of the Berlin Global Dialogue 2024 conference.

“When I look around the world today, I see the inadequacies of infrastructure in almost every country,” he added. “So we need to be decarbonizing, we need to be digitizing, we need to be moving forward, we need to be building out more and more and I think this is one of the big issues.”

The world’s largest asset manager, which oversaw about $10.6 trillion in assets as of June, has been pushing aggressively into infrastructure financing as it also grows the lucrative asset class of private markets. It has gone on a buying spree, announcing acquisitions this year of Global Infrastructure Partners for $12.5 billion, a deal that’s closing Tuesday, and the purchase of alternatives data-provider Preqin.

Last month, BlackRock said it was teaming up with Microsoft Corp. and others, seeking to raise $30 billion of private equity capital over time to bankroll the build-out of data warehouses and energy infrastructure behind the boom in artificial intelligence.

Fink also pointed out that beyond the equity component, they will be raising as much as $120 billion in debt associated with those data centers.

“Infrastructure is a major component on how we stimulate growth and because of the breadth of the capital markets we don’t have to rely on federal spending or state spending,” he said in the interview. “There is enough capital in the private sector that we will be able to fund these new projects and so to me this is the dawning of the new reality that we’re going to see broadening of public and private investment in infrastructure.”

Commenting on the outlook for interest rates, Fink said it’s hard for him to see another 200 basis-point decline in interest rates because “more policies by government tend to be more inflationary than deflationary.”

He expects the US economy to continue to grow at a 2%-3% pace, dismissing talks of soft- or hard-landing by analysts.

Most Read from Bloomberg Businessweek

©2024 Bloomberg L.P.

Latest article