Germany's state of Lower Saxony is considering investing at least €200 million to take control of parts of Volkswagen's Osnabrück plant, allowing it to produce Iron Dome components for Israel's Rafael directly and bypassing Qatari opposition, according to reports from Bild, Bloomberg and Hannoversche Allgemeine Zeitung. Qatar's sovereign wealth fund, holding 17% of Volkswagen voting rights, had blocked the deal, threatening 2,300 German jobs.
German state of Lower Saxony is reportedly considering an investment of at least €200 million to take control of parts of Volkswagen's Osnabrück plant, in a move designed to circumvent a Qatari veto on producing Iron Dome components for Israel's Rafael defense contractor.
The plan, reported by Bild, Bloomberg and Hannoversche Allgemeine Zeitung, would allow the state to deal directly with Rafael, bypassing Volkswagen's shareholders. Qatar's sovereign wealth fund holds 17% of Volkswagen voting rights and had opposed the production deal, according to earlier reports. The fund's opposition threatened to kill the contract and put 2,300 German jobs at risk.
As The Zioneer reported on July 14, Qatari shareholders had canceled the initial contract with Rafael, sparking anger in Berlin. The Lower Saxony intervention represents a potential workaround that could salvage both the defense industrial cooperation and the jobs tied to it.
The development also renews focus on Qatar's use of its economic leverage in Europe. Doha has long presented itself as a mediator in the region while hosting the political leadership of Hamas and using its sovereign wealth fund to influence corporate decisions with implications for Israeli security.
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