The People’s Republic of China (PRC) is presenting the European Union (EU) with one of the most significant challenges it has faced to its attempts to build a collective foreign policy between its member states with its actions towards Lithuania. While the focus has been on threats to the Baltic states and Poland from Belarus’ ‘weaponisation’ of migrants to apply political pressure on its neighbours or Russia’s actions in Ukraine, the PRC’s contemporary campaign of diplomatic and economic pressure on Lithuania has gone largely unnoticed.
The key significance of this PRC challenge to Lithuania is that it is testing whether the EU’s trade policy is a common policy in name only. The EU’s trade policy – its foreign economic policy – is one area in which the EU might claim to exercise its strongest international influence. In removing Lithuania’s ability to trade on the same basis as other EU member states, the PRC is attempting to demonstrate that it can isolate and punish one of the 27 members without a strong show of solidarity from other EU capitals.
Lithuania has incurred the PRC’s ire[↗] because of its desire to create a closer relationship with Taiwan. In July 2021, Joseph Wu, Taiwan’s foreign minister, announced that Taipei and Vilnius were to each establish representative offices in one another’s capitals. A majority of EU member states already have similar arrangements in Taipei, the EU has a European Economic and Trade Office, and there is a Taipei Representative Office to the EU in Brussels. Two months before, Lithuania pulled out of the ‘17+1’ group, which brings together the PRC and Central and Eastern European countries urging other members to follow suit as it undermined the EU’s ability to act collectively towards Beijing.
Beijing recalled its ambassador to Lithuania on 10th August – downgraded to charge d’affaires level in November – and demanded Vilnius remove its own ambassador to the PRC. In the official statement[↗] announcing the recall the PRC stated that Vilnius had demonstrated a
disregard of China’s repeated representations and articulation of potential consequences, has announced its decision to allow the Taiwan authorities to open a “representative office” under the name of “Taiwan”. The decision brazenly violates the spirit of the communiqué on the establishment of diplomatic relations between China and Lithuania and severely undermines China’s sovereignty and territorial integrity.
This did not deter Lithuania and the Taiwanese Representative Office opened in Vilnius on 18th November. It was the first such office in Europe to use Taiwan in its title (with ‘Taipei’ being used elsewhere).
The PRC has subsequently sought to apply economic pressure on Lithuania by halting the Baltic country’s access to the Chinese market. The extent of the economic pressure being applied to Vilnius was revealed by[↗] POLITCO with access to a letter from Gabrielius Landsbergis, Lithuania’s Foreign Minister, to Josep Borrell, the EU’s High Representative for Foreign and Security Policy, and Valdis Dombrovskis, the EU’s Commissioner for Trade, with details on the apparent removal of the country’s name from the PRC’s customs systems, shipments nor clearing customs, and the rejection of important applications.
The response from the EU’s top trade and foreign policy diplomats was a holding statement[↗] advising that the EU was ‘gathering information’ and ‘reaching out to the Chinese authorities’. The EU has, however, raised the question[↗] of the ‘unannounced sanctions’ by the PRC with Ngozi Okonjo-Iweala, Director-General of the World Trade Organisation (WTO), who, in turn, has been in discussions with Beijing.
The PRC has also now advised[↗] multinationals to end their links with Lithuania or lose access to Chinese markets. Vidmantas Janulevicius, President of the Lithuanian Confederation of Industrialists, has publicly confirmed[↗] that the PRC has now applied direct pressure on multinational companies to drop Lithuanian suppliers. Alongside the trade pressure on Lithuania, the Chinese Communist Party (CCP) – the government of the PRC – has sustained a campaign of public diplomatic disapprobation including tweeting[↗] from a Foreign Ministry spokesperson in late November stating that ‘racism remains a grave problem in the country with Jew and other ethnic minorities suffering serious discrimination.’
Meanwhile, the United Kingdom (UK), outside the EU’s trade policy, is not a direct party to Lithuania’s dispute with the PRC. But, through a Joint Communiqué[↗] agreed at the meeting between the three Baltic foreign ministers and the British Foreign Secretary in October, the four countries established a shared analysis of the ‘systemic challenges posed by China’. As it grapples with its security challenges from Russia and Belarus, alongside those from the PRC, the UK has shown solidarity and demonstrated a practical contribution to Lithuania’s security, including this week by deploying a military reconnaissance team to establish whether Britain can offer additional expertise or capabilities at the Lithuanian border with Belarus. This fits with the emerging pattern of the UK being an actively engaged guarantor of security in the region.
Prof. Richard Whitman is Professor of Politics and International Relations at the School of Politics and International Relations at the University of Kent.
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