Going Protectionist: Germany Unveils Its National Industry Strategy, Will Stop Sale Of Tech Firms To Non-EU Investors
Germany's Minister for Economic Affairs and Energy Peter Altmaier unveiled country's "National Industry Strategy 2030" last Friday (29 November), which gives enormous powers to the state to scrutinise and potentially block deals in sensitive parts of the economy, Financial Times reported.
Under the “national fallback option” that has been proposed in the document, the German government can temporarily take stakes in high-tech companies to stop them being sold to investors in non-EU countries. Under the option, the state would intervene whenever a non-EU entity tried to acquire a stake of 10 per cent or more in any German company involved in artificial intelligence, robotics, semiconductors, biotech or quantum technology.
The strategy document comprises of three pilars.
The first pillar of the strategy is to "improve the framework conditions" for Germany as an industrial location, Altmaier's ministry (BMWi) said in a statement.
The document proposes measures such as making corporate taxes more competitive, capping the social security contributions, mobilizing skilled workers, downsizing the bureaucracy and reducing their role in the functioning of the state
The plan advocates a new tax policy, which caps the "tax burden on our companies at a rate of 25 percent" so that Germany becomes an internationally competitive business location.
The second pillar of the industrial strategy calls for strengthening Germany’s footprint in new, emerging technologies and mobilize private capital. Germany and Europe would have to develop and apply "game-changer technologies," such as artificial intelligence (AI), according to the BMWi.
In addition, the country's innovation potential would have to be activated, ensuring that more technological innovations are applied in practice, the BMWi said.
This would mean advancing technology investments, setting the course for effective climate protection with a low-emission industry and carbon dioxide capture and storage (CCS), further developing the bioeconomy as well as promoting lightweight construction.
The third pillar is to maintain technological sovereignty in a global context. In particular, losses of know-how would have to be avoided and self-determination in key technological fields would have to be maintained.
As a last resort, however, the new strategy allows governmental interference in selected cases. "Temporary state participation should be considered and offered in individual cases via a national participation instrument," the BMWi stated.
Back in February, Altmaier presented his first proposals for an industry strategy, which drew heavy criticism. It had proposed the setting up of state investment fund that would step in to pre-empt foreign takeovers of German companies.