The German government has recently put on hold two planned takeovers of German high-tech companies by Chinese investors, with Berlin citing "security reasons" and fears of a sellout of crucial technology. German news agency DPA reported Monday a German embassy envoy was summoned by the Chinese foreign ministry in protest of Chinese investors being hampered in Germany.

On Monday, German Economy Minister Sigmar Gabriel is starting a visit to China lasting several days. Accompanied by a large business delegation, the minister is expected to debate the business climate in the Asian nation and what, in his eyes, needs to be done to improve conditions for German companies on the ground.

But his talks with Chinese leaders will not be easy as he needs to explain why Berlin all of a sudden shelved the planned takeover of two German firms, with US intelligence playing no small role in that decision, according to newspaper reports last week.

The economy ministry in Berlin has indicated that it seeks legislation at EU level to keep "unwanted" investors at arm's length.

No big problem?

Responding to such attempts, Daimler CEO Dieter Zetsche told the Monday edition of the German business daily "Handelsblatt" he didn't see much sense in trying to hammer out laws to keep some Chinese investors away.

"What has made Germany as a business location so strong has been the separation of the economy and the state to a large extent," he argued. "And this separation should be preserved," he said, adding that "dirigiste interventions" would not be successful.

"Building fences would only make our companies inert," Zetsche warned. He recalled a big public debate a while ago about the Chinese allegedly stealing and copying everything the West had to offer technologically.

"This assumption has been sheer nonsense," he said. "China is training more engineers than we do, meaning the country has a big vested interest to protect patents too."

Zetsche also reacted to concerns in the German business community about the lack of a level-playing field for investors, meaning that while Chinese companies extended their global shopping spree by buying a magnitude of companies, foreign firms in China had to form joint ventures with partners on the ground to forge any investment deal at all.

Daimler's chief executive agreed that more balanced contracts would be desirable in the future, but added that his company - being in cooperation with China's BAIC and BYD - had not felt any disadvantages so far. The takeover of some of Daimler's crucial parts suppliers by Chinese investors had also not had a negative impact, he insisted.

hg/sri (AFP, Reuters)