Germany to Scrutinize Chinese Turbine Deal for Offshore Project

(Bloomberg) -- Germany is examining an offshore wind developer’s choice of a Chinese manufacturer for its turbines over critical infrastructure concerns.

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The Economy Ministry “took note” of the agreement between Hamburg-based asset manager Luxcara and Ming Yang Smart Energy signed this week for 16 turbines and will “scrutinize it very closely,” a spokesperson said Thursday. Apart from concerns about infrastructure crucial to the country, the government will check to ensure that a “level playing field” is maintained “in terms of competition.”

The move comes amid intensifying trade tensions between China and the European Union, with the bloc ramping up tariffs against Chinese electric-car makers. After Russia’s war on Ukraine curtailed gas flows to the continent, Germany has been sensitive to third-country influence on sectors seen as strategic, with China coming under particular scrutiny.

Luxcara said it was aware of the security concerns and has been in talks with the government even before it chose the Chinese firm.

The Economy Ministry’s checks are “a normal part of the further procedure,” a spokesperson said, adding that the supplier was chosen after a “thorough consideration of the economic, legal and general risk factors.”

Ming Yang Smart Energy declined to comment on the government’s decision, which was first reported by Reuters.

The deal has also come under criticism from the domestic industry. Chinese manufacturers offer their turbines at low prices and with unfair deferred payments, a spokesperson for WindEurope said.

--With assistance from Luz Ding.

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