BlackRock named the main opportunities for investors and shared its outlook for Kazakhstan

Ben Powell, CFA, Managing Director, Chief Investment Strategist for the ARA Region at BlackRock Investment Institute

Emerging Markets and Opportunities for Investors

The business we have in India is very interesting to us. It is a huge country with a population of about 1.5 billion people. By the end of this decade, about 20% of the global workforce will be in India. Just the scale of this demographic creates enormous growth potential.

But for me, it is not just about population size. Over the past five years, India has made a significant technological leap. Thanks to this, hundreds of millions of people have gained access to more modern and convenient financial products.

I see here a combination of three factors: a large population, rapid technological progress, and a regulatory environment that is becoming more open. For us, this creates interesting opportunities.

At the same time, similar opportunities are emerging in other countries. Governments increasingly understand that they need private capital to finance large projects. This refers to hospitals, schools, roads, data centers, and other infrastructure.

We want to go where we are welcome, while expecting fair returns for our clients and pensioners.

Private Capital and Public Investment

In developed countries, public debt remains high. Therefore, the ability of governments to finance infrastructure solely from their own balance sheets is limited.

This creates space for private capital. If governments need money to build roads, hospitals, schools, and other facilities, the role of private markets will grow. I think this is one of the main opportunities for the next stage of capital market development.

India, China, and Global Investment Opportunities

We are lucky to be a global company. We do not have to choose between India, China, or Kazakhstan. We can look for opportunities in different parts of the world.

China is the world's second-largest economy, a huge and liquid market. Therefore, even a large fund like ours can operate there.

At the same time, it is not accurate to say that we simply "invest in China" or "invest in India." We look at specific countries, specific markets, and specific opportunities. We like finding diverse investments around the world where we can help and achieve fair returns.

Kazakhstan and the Attention of Global Investors

When we look at Kazakhstan, two things are important to us.

The first is the direction of regulation, infrastructure development, pension reform, and other changes that show the market is moving in the right direction.

The second factor is much more tangible — liquidity and market breadth. The more liquid the market becomes, the more we can invest. This is a fact.

When Kazakhstan becomes an emerging market, it will be an important milestone. But it is not the end of the story. We will continue to monitor the market.

From our perspective, everything looks positive now. But even then, we will want more liquidity, more market breadth, and greater scale. That is the BlackRock way. We are always a bit respectful and a bit greedy. Perhaps it is a combination of these two qualities.

Infrastructure as a New Megatrend

From an investor's perspective, we want to see good investment opportunities. It is not so important to us whether these are stocks or fixed-income instruments. We want the portfolio to make sense.

Does it make sense to have a certain share of infrastructure in the portfolio? Yes, I think it does.

Infrastructure and private markets are no longer a forecast. This is happening right now. Around the world, investors increasingly view private markets as a normal, mainstream part of an investment portfolio.

In the past two years, we acquired several companies, including Global Infrastructure Partners, a leader in the global infrastructure sector. We see great potential for implementing new projects around the world, including here in Kazakhstan.

Today, there is huge demand for infrastructure financing — from roads and data centers to other major facilities. These projects require trillions of dollars in capital.

I think BlackRock can be a useful partner for governments and society, including for Kazakhstan, if we can provide the necessary scale of financing.

How BlackRock is Changing

Our fundamental principle remains simple: use technology to manage risks and help clients. We do this today, but the technologies themselves have changed, and the world has become much more complex.

After the global financial crisis and up to COVID-19, there was a long period of growth during which virtually any ETF showed good results. Today the situation is different — markets have become more complex, so investors need greater diversification.

Public equities remain an important part of the portfolio, but private markets are playing an increasingly important role. They allow investors to access areas that are not available on public markets.

Therefore, our philosophy has not changed. We still use technology to manage risks and help clients, but the scale and complexity of the market today are completely different.

Blockchain and Tokenization of Capital Markets

Tokenization can change how capital markets are structured. Over time, portfolios may include tokenized assets of various types — from securities to other real assets.

To do this, we need to create new financial infrastructure and clear regulatory rules. We are already seeing the first examples in Bitcoin and digital currencies. It is particularly interesting to watch the development of legislation in the US, where the GENIUS Act was passed last year.

If the regulatory environment becomes more favorable, we will be able to create more tokenized products.

I think that in 5-10 years, tokenized assets will become a normal part of investment portfolios. But until then, we still have a lot of work to do.