UPDATE 1-German economy ministry favours blocking Chinese takeover of Elmos' chip production - sources

2 weeks ago 81

BERLIN, Nov 8 (Reuters) - Germany's system ministry has recommended to the furniture that the authorities artifact the Chinese takeover of Elmos' (ELGG.DE) spot factory, saying it would airs a menace to nationalist security, ministry sources said connected Tuesday.

Milder measures, specified arsenic an injunction, are not suitable for addressing the identified dangers, added the sources.

Elmos said connected Monday that the German authorities would apt block the merchantability to rival Silex, a Swedish institution that is simply a subsidiary of Chinese radical Sai Microelectronics (300456.SZ).

The sources said the system ministry and the authorities are presently moving connected a China strategy focused connected reducing one-sided dependencies and encouraging diversification, arsenic good arsenic protecting infrastructure and preventing exertion leakage.

German Chancellor Olaf Scholz said during a travel to Beijing past week that it was wide that China and Germany were no friends of "decoupling", portion besides complaining astir accrued difficulties for German companies accessing the Chinese market.

Concerns astir the grade of Chinese power successful German businesses came to the forefront past period aft Scholz pushed done a determination to let Chinese shipping elephantine Cosco (COSCO.UL) to bargain a involvement successful a terminal successful the country's largest port, triggering unprecedented protest from wrong his ain governing coalition.

In that case, the furniture approved a 24.9% involvement concern by Cosco, little than an initially planned 35% stake, and it does not springiness Cosco immoderate accidental successful absorption oregon strategical decisions.

The determination sparked an aggravated effect by the overseas ministry, which warned that the concern disproportionately expands China's strategical power and, successful the lawsuit of a crisis, would unfastened up the anticipation for China to politically instrumentalise portion of Germany's captious infrastructure.

Reporting by Markus Wacket, Writing by Miranda Murray Editing by Paul Carrel and Louise Heavens

Our Standards: The Thomson Reuters Trust Principles.

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