Merkel seeks to protect firms from foreign control

19th July 2007, Comments 0 comments

19 July 2007, Berlin (dpa) - Germany is considering vetting investments by foreign state-controlled funds in order to protect domestic companies from political influence from abroad, Chancellor Angela Merkel said Wednesday.

19 July 2007

Berlin (dpa) - Germany is considering vetting investments by foreign state-controlled funds in order to protect domestic companies from political influence from abroad, Chancellor Angela Merkel said Wednesday.

Merkel said she did not want to block such funds, but favoured the introduction of transparent control mechanisms like those in force in the United States.

"We have started a discussion that is still on-going," she told a news conference reviewing the performance of her coalition government since it took office in November 2005.

Her remarks came amid fears in her administration that newly rich state corporate behemoths in Russia and China could take over key industrial sectors in Europe's biggest economy.

Merkel said that she wanted a wide-ranging discussion on the issue, including drawing on the expertise of industry, which has long experience in dealing with foreign capital.

The chancellor said she also favoured discussions among the EU's 27 members for a uniform definition of "strategic industries" which might be covered by such mechanisms.

"A general ban is with certainty not the right answer," said Merkel, who warned two weeks ago that major German companies could possibly fall into the hands of hostile states through investments by foreign government-operated funds.

Merkel said her government would do everything in its power to prolong the economic upturn that Germany is currently enjoying in order to ensure that more people reap its benefits.

"The greater the upswing is the more influence will have have in shaping the international framework that is necessary to ensure that our traditional market economy continues to prosper," she said.

Germany has been experiencing a steady drop in unemployment and many economists now project German economic growth in 2007 to match or possibly surpass last year's 2.8 per cent.

The chancellor defended herself from criticism that she was basking in the success of Germany's successful presidencies of the European Union G8 club of wealthy nations and not doing enough on the domestic front.

"My leadership is the way I want it to be," the Christian Democrat said in response to claims by her Social Democratic coalition partner that she had shown a lack of leadership.

"Everyone leads in his own way," she said, adding that leadership alone cannot overcome differences of opinion. These can only be resolved through compromise."


DPA

Subject: German news

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