When Chinese home appliance maker Midea acquired a majority stake in Kuka, a pioneering German maker of industrial robots, in 2016, Kuka’s chief executive, Till Reuter, promised it would remain German. But when Kuka refocused its attention from Germany to China, Mr Reuter’s contract was terminated.
Regulators habitually scrutinise foreign takeovers of major defence contractors, but foreign acquisitions of cutting-edge technology have national security implications too. Governments should be much more vigilant.
Cutting-edge technology is one of the west’s strongest assets. It’s also easy for others to acquire by taking advantage of the openness of the globalised economy: rivals can weaken their adversaries and strengthen themselves. “Industrial penetration has become a weapon,” says George Robertson, the former Nato secretary-general and UK defence secretary under Tony Blair. “The Chinese government in particular is implementing foreign policy through industry.”