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Scholz made a compromise: China will be limitedly allowed into the port of Hamburg

Asia ( - The German government is considering a compromise that would allow a Chinese company to acquire a smaller-than-planned stake in a container terminal in the port of Hamburg after Chancellor Olaf Scholz rejected an outright ban on the sale. Chinese shipping giant Cosco was aiming for a 35 percent stake and the deal would have been automatically closed, despite opposition from several German ministries, if an "emergency solution" had not been found this week, France-Presse reported today, October 25 ( AFP) source in the German government.

Under the proposed compromise, the Scholz cabinet will green-light the sale of the terminal's 24.9% stake, which is a large enough reduction in the previously envisaged stock for sale to deprive China's state-owned Cosco of any voting rights.

The fate of the Tollerort terminal at the port of Hamburg, Europe's third busiest maritime harbor, has sparked fierce controversy in Germany. Hard hit by its heavy reliance on Russian energy, Europe's largest economy has become increasingly wary of allowing foreign powers to take over critical infrastructure, notes.

Six German ministries, including the departments of economy, defense and foreign affairs, wanted to veto the Cosco deal, and the former mayor of Hamburg, now Chancellor Olaf Scholz, supported it.

“The emergency decision will prevent strategic participation (of the Chinese in the operation of the terminal) and reduce it to purely financial participation,” the French news agency source said. “Of course, this does not eliminate all concerns.”

The controversy over the port of Hamburg is the latest dispute that shakes Scholz's tripartite coalition government between his Social Democrats (SPD), the left-wing Greens (Union 90/The Greens) and the Free Democrats (FDP).

Chinese companies already have stakes in other European ports, but the EU's stance on Beijing has hardened recently. In recent years, Germany has also been keeping a close eye on Chinese investment in sensitive technology and other areas, and reserves the right to veto Chinese investment.

Scholz is due to visit China early next month, becoming the first EU leader to make such a trip to China since November 2019. Despite growing concern at home and abroad about economic dependence on China, Scholz repeatedly insisted that Germany maintain strong business relations with the Asian giant, the world's second largest economy.

“We do not need to separate from some countries, we must continue to do business with them, and I will say frankly - also with China,” the head of the German government recently said.

China is Germany's main trading partner, especially for its flagship automotive industry.

Scholz made a compromise: China will be limitedly allowed into the port of Hamburg