German economy minister wants tougher foreign investment rules

BERLIN: Germany’s economy minister yesterday suggested tightening the rules on foreign investment, following concern over Chinese influence on European firms.

Last month it emerged that Chinese billionaire Li Shufu had quietly bought a near 10-percent stake worth around 7.2 billion euros ($8.9 billion) in German car giant Daimler — making him the group’s largest shareholder. “We must always adapt our law on the external economy according to new developments, including the threshold at which (the government) can become involved,” Economy Minister Brigitte Zypries told the weekly Der Spiegel.

Currently, Berlin can scrutinize a transaction and possibly prevent it, if the foreign investor seizes a stake worth more than 25 percent of a company’s capital.

“The fact is, the investors can often exert considerable influence on a business, even with a smaller stake,” said Zypries, a Social Democrat. China’s increasing interest in German companies has sparked unease in Europe’s biggest economy. The distrust is all the greater as EU nations are more open to investment from abroad than Beijing allows on its territory.

The subject will “have to be on the agenda of the new government, particularly with regard to strategic infrastructures, such as energy, transport or internet sectors”, Zypries said. —AFP