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Europe rejects Chinese chip investments aimed at EV market

U.K. and Germany take tougher line amid worries about state influence

Germany blocked the sale of an Elmos Semiconductor factory in Dortmund to a Chinese company.   © Reuters

FRANKFURT/LONDON -- Chinese semiconductor companies looking to expand through acquisitions in Europe face an increasingly chilly reception from regulators wary of state-driven investment.

The continent had been an attractive destination for Chinese players seeking to gain a foothold in supply chains in a leading market for electric vehicles. Direct investment in Europe by Chinese companies rebounded 34% in 2021 to 10.6 billion euros ($11.2 billion at current rates), with auto-related deals accounting for nearly a quarter, according to Germany's Mercator Institute for China Studies.

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