GERMANY would put its port of Hamburg at a competitive disadvantage if it quashed a bid from China’s COSCO Shipping Ports Ltd. to buy a stake in a container operator, the city’s mayor said.

A rejection would be “a one-sided, competition-distorting disadvantage for Hamburg compared with Rotterdam and Antwerp, where COSCO already owns terminal shares,” Hamburg Mayor Peter Tschentscher said Tuesday.

“In order to keep up with international competition, it must also be possible for shipping companies to participate in terminals in Hamburg if this makes business sense,” Tschentscher added.

COSCO Shipping Ports, the Hong Kong-listed terminal operator of shipping giant China COSCO Shipping Corp., last year made a bid to take a 35% stake in one of three terminals in Germany’s largest port in the northern city of Hamburg, a move that has been seen to boost the port’s throughput and efficiency as the COVID-19 pandemic disrupts global shipping and drives up shipping rates.

Hamburg, the second-largest port in Europe, enjoys a pivotal location as one of the most important trade hubs from Europe to China. It is also a significant node for China-EU freight trains.

But Germany’s Economy Minister Robert Habeck said last week that he was leaning towards not allowing the deal, which would give China a stake in German critical infrastructure.

Volker Treier, trade expert for the German Chambers of Industry and Commerce, said he was concerned that if there’s no clear criteria for rejecting the investment, this could negatively impact Germany’s allure for investors generally.

The Hamburg Port marketing director Axel Mattern warned against any veto, saying the Chinese investment would be a “huge win for the port rather than a danger.”

China’s fast expansion has driven growth in Europe’s largest economy over the past 10 years, with German carmakers currently relying on that market for as much as half their profits.

“A rejection of the Chinese would be a disaster not only for the port but for Germany,” Mattern said.

Mao Ning, Chinese foreign ministry spokeswoman, said she hoped Germany would “view Chinese investment in an objective and rational light, and provide a fair, open and non-discriminatory environment for Chinese companies, rather than politicize normal economic and trade cooperation, still less engage in protectionism in the name of national security.” (SD-Agencies)