Business: EU should ‘curb protectionism’

Chinese M&As ought to be seen in ‘objective’ way

European countries like Germany should put words into action to fight protectionism and regard Chinese companies’ investment in an objective and rational way, a Chinese trade official said Thursday.

The comment came after German newspaper Deutsche Welle reported on Sunday that Germany, together with France and Italy, had drafted a law that would give EU officials a “legislative tool” to examine strategic takeovers by Chinese companies and even power to intervene.

At the World Economic Forum in Switzerland last week, leaders from Europe, including leaders from Germany, all said that protectionism is not a good choice, Gao Feng, spokesperson for the Ministry of Commerce (MOFCOM), said at a press conference held on Thursday in Beijing.

China’s investment in Germany has been growing rapidly in recent years, but it is still in the initial stage with a relatively small volume, Gao noted.

China’s direct investment in Germany was $2.27 billion in 2017, Gao said, adding that cumulative foreign investment from the Chinese mainland accounted for less than 1 percent of Germany’s cumulative foreign investment, a level that could not be deemed any kind of “threat” to Germany.

Mergers and acquisitions (M&As) by Chinese firms in the European market is independent market behavior by the companies and it connects European capital and jobs with Asian markets, Gao said.

In a recent report by German newspaper Handelsblatt, for which it had talked to 42 German firms, including industrial robot producer KUKA AG, and numerous employees, the overall impression was that they were highly satisfied with Chinese investors, Gao noted.

Chinese investors have helped many German enterprises with funding, the spokesperson said, citing a report released by consulting firm PwC’s German office at the end of 2017.

Asian experts from the Bertelsmann Stiftung charitable foundation also said that Chinese investors had brought “a future of hope” to German enterprises and employees, Gao noted.

China will continue to open up and encourage domestic companies to invest in the European markets, Gao said, adding that “[we] hope European countries like Germany can regard corporate market behavior in an objective and rational way.”