Breaking: Germany inks deal with China's COSCO on Hamburg port

[beijingwalker]

Breaking: Germany inks deal with China's COSCO on Hamburg port​

Arthur Sullivan
May 11 2023

The scale of Germany's economic reliance on China is a source of increasing angst. Yet despite tensions, the government has approved a controversial deal that sees Chinese company COSCO acquire a portion of Hamburg port.

The German government has given final approval to a controversial deal that will see the Chinese shipping company COSCO take a minority stake in a container terminal at Hamburg port.

Last month it was announced that Chancellor Olaf Scholz's three-party coalition government was revisiting a decision made in October 2022 to give the go-ahead to the deal. The review came when it emerged that the Tollerort container terminal had been classified as critical German infrastructure earlier in 2023 by Germany's national cyber security agency, the BSI.

However, on Wednesday, chief government spokesperson Steffen Hebestreit said the government was sticking to the October decision, which caps COSCO's stake in the Tollerort terminal at 24.99%. That compromise had been reached following intense opposition to the deal from the Greens and the Free Democrats (FDP), coalition partners of Scholz's Social Democrats (SPD).

The Tollerort terminal is owned by the Hamburg port logistics company HHLA. The company says the deal will make Hamburg port a preferred destination for COSCO and help secure jobs. It also said the agreement would strengthen Hamburg's national and international importance as a logistics location.

Close to one-third of the goods handled at the port already come from or go to China. China has been Germany's biggest trade partner for the past seven years, with the value of trade between the countries rising to a record €298 billion ($320 billion) in 2022.

China has been Germany's biggest trade partner for seven straight yearsImage: Kay Nietfeld/dpa/picture alliance
That's despite a heightened political debate in Germany over the extent to which Berlin is dependent on its economic relationship with Beijing.

Government tensions on the issue​

In recent years, Germany has sought to limit Chinese investment in the country. The COSCO deal inflamed that debate, with several government ministries connected to the Greens and the Free Democrats demanding last October that the company's stake be capped so it could not have outright control.

Critics have argued that allowing the deal to proceed creates a major security issue as it gives the Chinese government undue influence in the port terminal. COSCO already holds stakes in many other European ports.

Scholz's party was especially keen on pushing the deal through. However, there remains tension on the issue within the government. The Economy Ministry, led by the Greens' Robert Habeck, released a statement after the deal was confirmed on Wednesday, saying, "There were different assessments when assessing the acquisition of a holding."

Germany inks deal with China's COSCO on Hamburg port – DW – 05/11/2023

The scale of Germany's economic reliance on China is a source of increasing angst. Yet despite tensions, the government has approved a controversial deal that sees Chinese company COSCO acquire a portion of Hamburg port.

www.dw.com

 

[Nan Yang]

Gosh... sign it already..

Germany says controversial Chinese stake in Hamburg port to go ahead

• Berlin had been reassessing whether to let the deal proceed amid security concerns over the sale of what has been classed as critical infrastructure
• State-owned Chinese shipping giant Cosco will be allowed to buy an up to 24.9 per cent stake in the Tollerort container terminal

Agence France-Presse
Published: 2:53am, 11 May, 2023

A Cosco container ship is seen in the harbour in Hamburg, Germany in October 2022. Photo: AP

The German government said on Wednesday that it would allow a Chinese firm to buy a stake in a Hamburg port, after the terminal was classed as critical infrastructure.

The government controversially gave the go-ahead in October for state-owned Chinese shipping giant Cosco to buy up to a 24.9 per cent stake in the Tollerort container terminal in Hamburg.

The green light came despite security concerns over the sale of the infrastructure to Chinese investors, with Chancellor Olaf Scholz resisting calls to ban the sale outright.

In April, Berlin said it was reassessing whether to allow the sale to go ahead.

But on Wednesday a government statement said the original approval of a sale of less than 25 per cent had not changed.

No more details were given about the reasons behind the decision.

Cosco initially sought to purchase a larger 35 per cent stake in the port before a compromise agreement was announced.

Germany has been re-evaluating its economic relationship with China amid concerns over human rights and the communist country’s ties with Russia, as well as the escalation of tensions over Taiwan.

In November, Germany blocked the sale of two chip makers to Chinese investors because of security concerns around the key technology.

Germany has also capped investment guarantees for German companies doing business in China, as Europe’s largest economy looks to reduce its dependence on Beijing.