Concerns over Chinese corporate takeovers are unnecessary: official
China on Wednesday asked for Germany to remain calm and fair in dealing with issues regarding acquisitions by Chinese companies, as concerns in the country have been growing, including among high-level German officials.
At a press briefing in Beijing, Shen Danyang, spokesman for the Ministry of Commerce, said concerns from German officials that China's acquisitions would take away technology and jobs are unnecessary.
Shen further stated that China hopes Germany can remain calm and create a fair environment for investors.
China also hopes a recent decision by the German government to withdraw approval for a Chinese firm to acquire chip equipment maker Aixtron and to resume a security investigation into the case is just an "exception," not the sign of a shift in Germany's economic policies, the spokesman said.
Talks in Beijing
Shen's comments came after German Economic Minister Sigmar Gabriel's meeting with Chinese government officials on Tuesday. Reuters reported the meeting was marked by tensions over corporate takeovers.
Sigmar Gabriel is currently in China with a 60-strong delegation. A week earlier, his ministry withdrew approval for Fujian Grand Chip Investment Fund to buy Aixtron, citing new security concerns.
Before his trip to China, the outspoken minister said on Saturday that China is strategically buying up key technologies in Germany while protecting its own companies against foreign takeovers with "discriminatory requirements" and urged the EU to adopt a tougher approach with China.
Zheng Chunrong, a professor of German Studies at Tongji University in Shanghai, said while calls for market access have long been insisted by the German side, Gabriel used the media to pressure the Chinese side amid the recent surge in merger cases in Germany by Chinese firms.
Zheng said problems should be worked out through bilateral dialogue, and the two countries should stay away from protectionism.
"As the depth and width of Sino-German economic ties continue to expand, friction naturally arises as Chinese companies move up in the industrial value chain," Zheng told the Global Times Wednesday.
Despite rapid growth in recent years, China's investment in Germany "is not very large," Shen said.
Data from the Chinese Embassy in Germany showed that there are 8,200 German companies doing business in China compared to the 2,000 Chinese companies doing business in Germany.
Chinese investment in Germany is a tenth of Germany's investment in China and Chinese investment account for a mere 0.2 percent of total foreign investment in the European country.
Bilateral trade between China and Germany stood at 163 billion euros ($178.4 billion) in 2015, accounting for about a third of EU-China trade.
China and Germany should firmly push forward with liberalization of trade and investment, as well as oppose protectionism, Premier Li Keqiang said in a meeting with Sigmar Gabriel in Beijing on Tuesday, according to a government statement on Wednesday.
Major economic partners
"In 2015, Germany had a large trade deficit with China at almost 20 billion euros, compared with a more balanced relationship before," German Ambassador to China Michael Clauss told the Global Times in an interview last week, saying Germany is China's major economic partner in Europe as China is Germany's in Asia.
In terms of investment, Chinese investment in Germany reached $10 billion this year, almost 20 times higher than in 2015, Michael Clauss said, noting that the main challenge for the future will be to achieve more reciprocity between the two countries.
Reciprocity also points to eligibility in the Chinese government procurement programs and relaxing ownership cap in joint ventures, Zheng said.
Tian Yun, chief editor of the China Macroeconomic Information Network, said the friction reflects a deeper worry on the German side of the role each country plays within the existing global value chain as both countries invest heavily in their manufacturing capacity.
Rapid Chinese technical advance in certain areas such as digitalization has fostered a sense of apprehension among German elites, Zheng said.
Germany's Industry 4.0 program and China's Made in China 2025 program both aim at improving competitiveness in manufacturing.
"Countries such as Germany, Japan and South Korea saw manufacturing as their foundation, and as China tries to move up the value chain, moving from maker of consumer goods to industrial equipment, it faces competition, doubts and frictions," Tian said, noting that the market economy is also subject to the influence of political powers.
