China Takes Retaliatory Measures Against Lithuania in Response to Its Support for Taiwan
China has told multinational corporations to break off ties with Lithuania or risk being shut out of the Chinese market, Reuters reported Dec. 9. The escalation comes after Lithuania's ruling coalition agreed in November 2020 to support "those fighting for freedom" in Taiwan, publicly challenging China's claim to the island nation. Further, the European Union noted that Lithuanian shipments are not being cleared through Chinese customs and that import applications from Lithuania are being rejected.
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European Commission Executive Vice President Valdis Dombrovskis and Vice President Josep Borrell said in a joint statement they are "reaching out to the Chinese authorities to rapidly clarify the situation," and gathering information from their EU delegation in Beijing. The two also reaffirmed the need for "unity and solidarity within the EU."
The EU took Lithuania's case over China's "unannounced sanctions" on its goods to WTO Director-General Ngozi Okonjo-Iweala, who then raised the issue with Chinese Premier Li Keqiang, according to a diplomatic memo seen and reported on by Bloomberg. A WTO dispute proceeding is a lengthy process, with a full resolution potentially taking as long as three years, with a potential appeal coming later. But, the DG could help resolve the issue at the WTO via a voluntary "good offices," which engages an independent voice to help guide the parties to a solution, Bloomberg reported.
A Chinese Foreign Ministry spokesperson denied knowledge of specific instances of Chinese customs rejecting Lithuanian goods but stressed that China always follows WTO rules. "Lithuania acted in bad faith, renounced the political commitment it has made to China upon the establishment of diplomatic relations with the People’s Republic of China, and openly created the false impression of 'one China, one Taiwan' in the world," the spokesperson said. "Such egregious act seriously undermined China’s sovereignty and territorial integrity and created a vile precedent in the world. We will resolutely uphold national sovereignty and territorial integrity and defend our core interests."
Mantas Adomenas, Lithuania's vice minister for foreign affairs, said he has seen some companies cancel contracts with Lithuanian suppliers, but he did not provide names, Reuters reported. Another senior government official told Reuters that Lithuania is looking to set up a fund to shield local companies from retaliatory measures. The Baltic state has also requested the European Commission's help, Reuters said.