“European countries should buy stakes in companies to counter the threat of Chinese takeovers,” the EU antitrust chief suggests.
The European Union (EU) fears that China could exploit the economic downturn caused by the Wuhan coronavirus outbreak to take over European companies.
EU antitrust chief Margrethe Vestager called for the revamping of European law to block Chinese state-owned firms from taking over vulnerable European businesses, the European news reports said.
“European companies have long been in the sights of Chinese rivals, but the sharp economic downturn caused by the coronavirus outbreak and subsequent steep falls in share prices across the continent have increased the potential for overseas bids,” the London-based daily Financial Times reported on Sunday.
Vestager, who is also the executive vice-president of the European Commission (EU’s executive arm), stressed the urgency of the Chinese threat by vowing to publicize Brussels’s regulatory counter-measures “as quickly as possible.” The top eurocrat’s warning coincides with the news of Germany, Europe’s largest economy, heading into a ‘deep recession’ amid a full-blown coronavirus outbreak in the country.
With the epicenter of the life-threatening contagion moving from Asia to the West, the leading European economies — Germany, France, the United Kingdom, Italy, and Spain — have been the worst hit. The Wuhan virus outbreak could cost as much as $4.1 trillion, or 5 percent of the global economic output (GDP), The Philippines-based Asian Development Bank (ADB) estimates. Europe’s export-dependent economies are expected to bear a heavy brunt of the coronavirus-induced global downturn.
The French broadcaster Euronews reported EU commissioner Vestager’s statement:
European countries should buy stakes in companies to counter the threat of Chinese takeovers, the Commission has said, part of the EU’s attempts to protect its businesses amid the coronavirus outbreak.
It has been long feared by some that certain companies maybe targeted by Chinese rivals, but the sharp economic downturn caused by the recent outbreak and steep falls in share prices across the continent have increased the vulnerability of businesses for potential foreign bids.
Margrethe Vestager, European Competition Commissioner, told the Financial Times: “We don’t have any issues of states acting as market participants if need be — if they provide shares in a company, if they want to prevent a takeover of this kind.
“It’s very important that one is aware that there is a real risk that businesses that are vulnerable can be the object of a takeover,” Vestager said.
“The situation now really underlines the need so we work really intensively. This is one of our main priorities.”
Possible changes were being considered before the coronavirus outbreak and while there is unlikely to be immediate action, Vestager did say she wanted regulations that acted as a deterrent and that these should be drawn up “as quickly as possible”.
The changes would target corporations owned or backed by non-EU governments, to address mainly French and German concerns, that their financial power grants them an unfair advantage over European competitors.
The European concerns highlight how the Communist regime in Beijing cynically plans to take advantage of other countries’ misfortune caused by the outbreak, which originated in central China. While the West and the rest of the developing world reels under the impact of the Wuhan coronavirus, Beijing dreams of wiping out the competition and dominating the global stage.
This Communist regime knows no shame. China’s Xinhua news agency called on the devastated world to “thank China, rather than blame it” for its handling of the outbreak, according to Reuters. The state-run news outlet also warned that if Beijing were to stop the export of medicines, “the United States would sink into the hell of a novel coronavirus epidemic.”
While arresting the whistleblowers and covering up the origins of the contagion, China’s leading diplomats have been spreading vile conspiracy theories accusing the U.S. Army of planting the deadly virus in central China. The Liberal mainstream media in the West, which played useful idiots for the Soviet Union throughout the Cold War, are busy carrying water for China’s Communist regime.
Secretary Pompeo blasts China for “disinformation campaign” over Wuhan coronavirus outbreak (March 25)
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