German go-ahead for China's Cosco stake in Hamburg port unleashes protest
Nov 1 2022
With the support of Scholz's Social Democrat-led ministries, the cabinet approved a 24.9% stake investment by Cosco in one of logistics firm HHLA's (HHFGn.DE) three terminals in the Hamburg port.The approved investment is less than the initially planned 35% stake that the Chinese shipping giant and HHLA had aimed for and does not give Cosco any say in management or strategic decisions. too dependent on Russian gas has changed many politicians' attitude towards strategic foreign investment. The foreign ministry was so upset over the approval that it drew up a note on the cabinet meeting documenting its rejection, Reuters was told by two government sources.
The investment "disproportionately expands China's strategic influence on German and European transport infrastructure as well as Germany's dependence on China", the document, seen by Reuters, says. It points to "considerable risks that arise when elements of the European transport infrastructure are influenced and controlled by China - while China itself does not allow Germany to participate in Chinese ports".
In the event of a crisis, the acquisition would open up the possibility for China to politically instrumentalise part of Germany's as well as Europe's critical infrastructure, it says. The economy ministry and the four ministries led by the liberal Free Democrats joined in drawing up the note, according to the sources.
Scholz, a former mayor of Hamburg, has once again asserted his will against his coalition partners, the Greens and the Free Democrats. After pushing through a nuclear power extension single-handedly last week, the Cosco move fuels discord at home and among European allies who are against the Chinese investment and already see Scholz as increasingly isolated.
Scholz is scheduled to travel to China next week.
HHLA WELCOMES DEAL
HHLA, which is majority-owned by the city of Hamburg and one of the main users of the port, welcomed the deal.
"We appreciate that a solution has been found in objective and constructive talks with the federal government," said Angela Titzrath, chairwoman of HHLA's executive board.
It was working on finding an agreement with Cosco on the new conditions in a timely manner, she said.
With the original 35% deal, the German logistics firm had wanted to tie its long-standing shipping customer to Hamburg port in the face of fierce international competition.
Cosco did not immediately reply to a request for comment. A German government source told Reuters that the Chinese company had agreed to the deal.
Chinese foreign ministry spokesperson Wang Wenbin, asked about the deal, said on Wednesday that China hoped "relevant parties would see pragmatic cooperation between China and Germany rationally (and) stop gratuitous hype", without giving further details.
Supporters of the HHLA deal say it will allow Hamburg to keep pace with rival ports that are also vying for Chinese trade, some of which are partly owned by COSCO.
COSCO's Shipping fleet accounts for approximately 3% of the world’s carbon emissions.COSCO Shipping Corporation Limited, abbreviated as COSCO Shipping, is a Chinese state-owned conglomerate headquartered in Shanghai. China's COSCO SHIPPING Holdings Co. Ltd. engages in the provision of container shipping, managing and operating container terminals ports, and container leasing services. It operates through following business segments: Container Shipping, Container Terminal, and Corporate and Other Operations.
The company's latest incarnation was founded on March 3, 2005 and is headquartered in Tianjin, China. Li Ka-Shing held commanding shares during its early formative years.
At present, the Group is actively involved in the “Belt and Road” Initiative and controlling global trade and the national strategy of Yangtze River Economic Zone. Currently it's global and forward-looking view has purchased many ports throughout the world which today has the claim to being the globe's biggest shipping company and ruling the maritime world. All this since its state owned communist controlled enterprise beginnings in the 1960's. [and now PLA controlled, indeed a military threat to the world not just the global economy with the planned acquisition of ports]