Open your firms to Chinese investment, Li tells Germany

FILE PHOTO: Chinese Premier Li Keqiang gives a speech during an event to celebrate the 40th anniversary of a peace and friendship treaty between China and Japan in Tokyo, Japan, May 10, 2018. REUTERS/Kim Kyung-Hoon/File Photo

BERLIN (Reuters) - China’s Premier Li Keqiang called on Berlin to sweep aside barriers hindering Chinese firms’ investment in Europe, urging German companies “not to be afraid” of cooperating with their Chinese counterparts.

Li’s message, in an article for the Frankfurter Allgemeine, comes ahead of an intergovernmental summit in Berlin next week, when German manufacturers’ concerns about loss of technological leadership to China are likely to be high on the agenda.

The manufacturing and exporting powerhouses are allies as well as rivals, since both stand to lose from the looming trade war being pushed by the U.S. President Donald Trump.

But European officials are concerned at flush Chinese companies’ acquisitions in Europe, fearing that Europe’s know-how and technology advantage is being lost. Both Brussels and Berlin have proposed new instruments for blocking Chinese acquisitions in strategic sectors.

“(I hope) Germany changes its mind and creates a fair, open environment and a stable institutional framework for companies that invest in Germany or Europe,” Li wrote in the opinion piece.

Chancellor Angela Merkel has stated she wants Europe to play a more interventionist role in preserving and strengthening strategic sectors such as semiconductors, battery technology or artificial intelligence, to avoid a loss of know-how that could damage local industries.

But Li said Europe was wrong to fear that Chinese investments would lead to European companies suffering a loss of expertise or technological advantage.

German companies should not be afraid of cooperating with Chinese companies, he wrote, since China protected intellectual property and “does not force foreign companies into technology transfer.”

Reporting by Thomas Escritt; Editing by Robin Pomeroy