Possible green light for Chinese takeover of German chip production

The German government is about to approve a Chinese acquisition of a German chip production site. This happens despite warnings from German intelligence agencies.

It is a production site of Elmos in Dortmund by the Swedish Silex, which is a subsidiary of the Chinese Sai Microelectronics. The deal is currently being investigated by the German Ministry of Economics. A final decision is expected within a few weeks.

Elmos is a smaller player in the chip market and mainly produces chips for the automotive industry. Silex wants to take over the production site in Dortmund for 85 million euros. If the deal goes ahead, Elmos will give up its own production and henceforth buy from other manufacturers.

The German government claims that Elmos uses older technology. It therefore does not expect critical knowledge to flow away to China as a result of the deal. However, German security authorities also express their concerns about China’s growing chip production capacity. They advise the German government to stop the deal. The president of the German federal intelligence agency BND recently warned that China is making acquisitions in strategic industries in order to put pressure on countries.

A few days ago, the government also approved the purchase of a stake in the port of Hamburg by the Chinese state-owned and transport giant Cosco. Germany ignored warnings from both the European Union and six German federal ministers.

Louise Roth is the youngest member of WeeklyNewsReview team. Despite the young age Louise is interested in serious topics. Her main interests and education is all about economics and politics. But in our team she is the most productive do-it-all member, so she has to write on a variety of topics.