The Ukrainian government announced on March 12 that it had decided to nationalize a military manufacturing company in the face of Chinese investors seeking to take it over.
Motor Sich, an aerospace company that produces engines for helicopters and airplanes, and also manufactures engines that can be used for cruise missiles and drones, which at the time of the Ukrainian government’s announcement was 75% owned by Chinese shareholders.
“The decision has been taken to return Motor Sich to the Ukrainian people,” Oleksiy Danilov, the head of Ukraine’s Security and Defense Council, said following a meeting on March 11.
Danilov assured that the procedure will be done in a legal and constitutional manner, that is the shareholders will receive their due compensation.
Ukrainian President Volodymyr Zelensky’s decision comes in response to pressure from both its ally the United States and its officials who consider Motor Sich too important and too close to the national military to be sold to foreigners.
In January, the U.S. Department of Commerce sanctioned Skyrizon Aviation, one of Motor Sich’s major Chinese investors, and noted that the company was acquiring military technology for eventual use by the Chinese Communist Party army.
The decision provoked the CCP’s anger, mainly because it does not have the technical capacity to manufacture the aircraft and drone engines that Motor Sich has, and the failed acquisition attempt wrecked the expansion plans of the Chinese Communist regime that sought to acquire such technology for its military.
Foreign Ministry spokesman Zhao Lijian said the CCP urges the “Ukrainian side to safeguard the legitimate rights and interests of Chinese companies and investors in accordance with law and properly handle relevant issues.”
In December, the Chinese investors behind Skyrizon filed a $3.5 billion arbitration case against Ukraine, accusing Kyiv of expropriating their investment in Motor Sich, which is highly contradictory because the CCP does not comply with any international standards, despite having adhered to many of these because it is a member of the U.N.
Zelensky’s decision is not minor: Ukraine has an economy too small to compete with China in case of Beijing taking economic retaliation and is in constant conflict with Russia, another power exponentially larger than Ukraine and China’s ally.
But the decision was right and the courage great, and it will certainly have a great influence on the country’s future.