Remember the Dubai Ports World scandal? Back in 2006, when everything was hunky dory with the world economy, Western politicians found it easy to block sales of assets to investors from countries deemed to pose national security concerns.
But today, with cash running thin in the US and Europe, denying such deals aren’t easy.
Der Spiegel looks at a similar scene playing out in Germany with a shipyard owned by ThyssenKrup
Germany’s shipping industry has taken a pounding in recent years. And shipbuilding hasn’t been doing much better. Shipyards belonging to ThyssenKrupp, Germany’s largest steelmaker, haven’t seen a new foreign contracts for 11 years, with orders instead going to cheaper foreign competitors. And until recently, its books had been filled with orders for luxury yachts — but almost all of them have been cancelled. The time to act — or jump ship, as some would have it — has arrived.
On Thursday, the company announced it was selling off a large chunk of its Blohm + Voss shipbuilding operations to the Abu Dhabi-based MAR Group. In addition to creating a new joint venture for the manufacture of military vessels, MAR Group will also take over 80 per cent of the ThyssenKrupp subsidiaries Blohm + Voss Shipyards, Blohm + Voss Repair and Blohm + Voss Industries. MAR Group already acquired a 90 per cent share in Nobiskrug Shipyard in Rendsburg, Germany, in July.
The Financial Times Deutschland writes:
“What a change in climate. Two years ago, German politicians and business lobbyists were fighting over the German Foreign Trade and Payments Act (AWG). … And now Abu Dhabi wants to team up with the Blohm + Voss shipyards to build warships — and the government’s alarm bells lie silent.”
“It would appear that the government is right to stay out of it. The construction of submarines, with their highly sensitive military technology, will remain entirely under the control of Thyssenkrupp. The joint construction of standard frigates presents no security risk to either Germany or its NATO partners. Even if Abu Dhabi was insane enough to want to arm itself and attack Europeans, they could easily get their hands on warships somewhere else.”
The point is not that the deal is bad for Germany, and in the end, Dollars and Euros will be repatriated in exchange for domestic assets, but it’s obvious that the economic situation makes older national security ideas a luxury.
NOW WATCH: Briefing videos
Business Insider Emails & Alerts
Site highlights each day to your inbox.