Germany blocks another big business deal with China

Germany has blocked the sale of a Volkswagen subsidiary to China on national security grounds. MAN Energy Solutions, part of the Volkswagen Group, had planned to sell its gas turbines business to a Chinese state-owned company. The German government review raised concerns that China might use the gas turbines for military purposes. This decision comes after the European Union imposed tariffs on electric vehicles from China, sparking a trade dispute. Germany aims to protect local manufacturers and reduce dependence on China. In November 2022, Germany also blocked the sale of a semiconductor factory to a Chinese-owned tech company. China’s Ministry of Foreign Affairs opposes the “politicization” of commercial cooperation. MAN Energy Solutions respected the decision and will close down the gas turbine division. The EU has intensified consultations with China to resolve the trade dispute.