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Lithuania’s increasingly close Taiwan ties pose challenge for China

Beijing’s response to Vilnius has been restrained over fears other EU countries could look to Taiwan

Taiwan and Lithuania flags. (Depositphotos image)

Taiwan and Lithuania flags. (Depositphotos image)

TAIPEI (Taiwan News) — Lithuania’s warming relations with Taiwan could prove to be a litmus test on how effective China’s economic pressure is on countries seeking closer ties with Taipei, according to Nikkei.

The opening of a de facto embassy — The Taiwanese Representative Office in Lithuania — has greatly increased tensions between China and Lithuania; however, Beijing has stopped short so far of cutting all diplomatic ties with the Baltic country. The office is the first for a European Union country to use the name “Taiwan” rather than “Taipei.”

China has made it a point to pressure any countries that diplomatically recognize Taiwan. But its response to Vilnius has been somewhat restrained out of fear it could push other European countries to follow Lithuania’s lead, Nikkei said.

Beijing recalled its ambassador to Lithuania in August when the plan was announced, and then it downgraded its diplomatic mission in the country to a charge d’affaires in November. The Chinese Embassy in Lithuania last month announced a temporary suspension of consular services, but that notice was removed from its website in less than an hour, per Nikkei.

China wants to reduce the risk of increasing tensions with Europe. The report pointed out that while the EU has been vocal about Beijing’s human rights abuses, the relationship between China and the EU has been largely guided by Chancellor Merkel from Germany, a country with close economic ties to Beijing.

Merkel’s upcoming departure could alter the EU’s internal power balance with respect to China. China “needs to stabilize its overall relationship with Europe,” Nikkei cited an international relations scholar in Beijing as saying.

Taiwan and Lithuania have also been invited to the “Summit for Democracy” hosted by the U.S. this week, and China may be worried that pushing Lithuania too hard may cause more countries to take a stand against Beijing, the report said.

Lithuania does not have deep economic relations with China. Beijing only purchased 1% of Lithuania’s exports last year, per the report. Recent news that Lithuanian companies are not being cleared through Chinese customs is unlikely to do significant damage.

In the meantime, Taipei and Vilnius have sought closer economic ties. The two countries signed memorandums of understanding in October on economic cooperation in areas such as semiconductors, according to Nikkei.

The report also pointed out that Chinese economic pressure may not be as powerful as once thought, citing Australia as an example, which ships more than 30% of its exports to China and has been hit with trade barriers that include big tariffs on agricultural products.

Nikkei cited Australian Treasurer Josh Frydenberg as saying in September that exports to China dropped around AU$5.4 billion (US$3.8 billion) in the year through June but that exports to other parts of the world jumped by AU$4.4 billion in the same period. “The overall impact on our economy has, to date, been relatively modest,” Frydenberg said.