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Even EU members take ‘wait and see’ approach on China-Lithuania standoff 

 | News Today

Even EU members take ‘wait and see’ approach on China-Lithuania standoff

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Taiwan has pledged $1 billion to Lithuania in its latest move to counter Chinese pressure on the small Baltic nation – the first European Union member to allow Taipei to use its name on a de facto embassy.

Taiwan’s pledge on Tuesday will help fund joint projects in half a dozen sectors and comes after a Jan. 5 deal to invest $200 million in Lithuanian industry.

The combined $1.2 billion investment is aimed at countering growing Chinese pressure on Vilnius since November 18, when Lithuanian authorities allowed Taiwan to open a representative office in its capital under the name “Taiwan”. instead of “Chinese Taipei”.

This gesture upset China, which considers Taiwan as part of its territory. In the past two months, China has recalled its ambassador from Vilnius while ordering the Lithuanian ambassador to leave Beijing, and it has implemented an embargo against Lithuania, boycotting all its exports as well as all products from EU that use components made in Lithuania.

At a press conference on Wednesday, Chinese Foreign Ministry spokesman Wang Wenbin called the $1.2 billion investment “an attempt by the Taiwanese authorities to expand the space for activities. of Taiwan independence with dollar diplomacy”.

China sees Taiwan finally coming back under its control, even though many Taiwanese see themselves as a self-governing nation.

“None of us thought that the volume of trade between Lithuania and China was so big, so we thought that China would not use economic sanctions against them,” said Chang Fu-chang, associate professor. at the Graduate Institute of European Studies at Tamkang University in Taiwan. , told VOA Mandarin. “But we were wrong.”

Bor Yunchang, an economics professor at Taipei Chinese Culture University, is pessimistic about Taiwan’s investment. He told VOA Mandarin: “Any investment made for political purposes will be on thin ice. It simply cannot be as effective in linking the two countries as the flow of capital between the private sectors.

Photo taken on Nov. 18, 2021 shows the building with the Taiwanese representative office in Vilnius, Lithuania.

China’s Revenge

In most European countries and the United States, Taiwan uses Taipei, the name of its capital, for its foreign offices which are embassies unless officially designated. Lithuania’s move came as many governments explore expanded ties with high-tech industrial powerhouse Taiwan, even as Beijing’s increasingly assertive foreign and military policy in the region has caused unease in the whole world.

Taiwan’s presence in Vilnius is its first new representative office in Europe since the opening of the Taipei representative office in Bratislava, Slovakia, in 2003. During the opening of the office, the Chinese Ministry of Foreign Affairs accused Lithuania to “undermine China’s sovereignty and territorial integrity” and told Vilnius to “correct the mistakes immediately.

“This development is really striking,” Rand Corporation senior defense analyst Timothy Heath told VOA’s Russian service, referring to the Vilnius office. “It’s the first time a European country has expressed formal recognition of Taiwan in decades. It’s a pretty big development, and it’s understandable that China is very angry at this change.

Relations between the two countries were fraying before the opening of the new office in Taiwan. In August, Beijing stopped approving new permits for Lithuanian food exports to China and halted direct freight train service to Lithuania. Then, in November, China began pressuring EU companies to stop using Lithuanian components.

Mantas Adomenas, Lithuania’s deputy foreign minister, told Reuters in December that China had “sent messages to multinationals that if they use parts and supplies from Lithuania, they will no longer be allowed to sell on the Chinese market or to get supplies there,”

In a videoconference with Taiwan’s National Development Council Minister Kung Ming-Hsin on Tuesday, Aušrinė Armonaitė, Lithuania’s Minister of Economy and Innovation, said Vilnius is already seeing companies canceling contracts with Lithuanian suppliers due to pressure from Beijing.

“I think China is very worried that Lithuania will set a precedent and that more countries in Europe may follow Lithuania’s example. I think that’s why China reacted so harshly,” Heath said.

Even EU members take ‘wait and see’ approach on China-Lithuania standoff 

 | News Today

This general view shows the Lithuanian Embassy in Beijing on August 10, 2021.

Uncertain future

Chang, of Taiwan’s Tamkang University, said China’s targeting of multinational companies in EU member states outside Lithuania is particularly effective because companies enjoy the lucrative Chinese market.

He said Lithuania’s main trading partners include two other Baltic countries – Estonia and Latvia – as well as Russia and the EU.

Chang added that while “Taiwan has intensified its efforts to develop trade relations with Vilnius, Lithuania’s export structure is unlikely to change in the short term.”

Lithuanian leaders also have different views on their country’s trade policy with China. In early January, Lithuanian President Gitanas Nauseda said it was a “mistake” to allow the Taiwanese designation to be used.

Chang said external pressures and internal conflicts are hampering the Lithuanian government’s efforts to garner public support for its China and Taiwan policies. Within the government, differences of opinion between the president and the prime minister have sparked a confrontation between pro-China and anti-China factions, he added.

“So the big question is how long can the Lithuanian government support Taiwan,” Chang told VOA Mandarin. “That $1.2 billion is not a big amount, so in the long term it’s hard to say where the economic relationship between the two countries will be.”

Heath of the Rand Corporation said many countries were taking a “wait and see” attitude about whether they could consider the path Lithuania is taking.

“I think in the short term the EU will recognize the importance of trade relations with China. The biggest countries – France, Germany, Italy – are in no rush to destabilize their trade relations with China,” he told VOA Mandarin.

Heath continued: “Nevertheless, I think countries in Europe and around the world are watching closely: what happens to Lithuania? Is it abandoning its relationship with Taiwan? Or is it keeping it? Whatever its decision, many countries around the world will be watching carefully and considering what it might mean for their own relationship with Taiwan.

Vadim Allen, a VOA Russian Service reporter, contributed to this report by the VOA Mandarin Service.

Even EU members take ‘wait and see’ approach on China-Lithuania standoff

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