A disagreement unfolded recently months between Lithuania and China. Lithuania is a small, Eastern European nation of less than 3 million people, and China is a superpower with an economy that will probably surpass the United States.
It all started last year, when Lithuania poked Beijing in the eye -- twice in the space of a few months.
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By filing a formal complaint against China at the World Trade Organization this week, the European Union is putting its weight in support of member state Lithuania, inserted as a test of the EU’s willingness to protect the interests of its smallest members. He is going. The face of Chinese power and aggression.
First, it withdrew from the so-called "17+1" group, a forum in which 17 eastern and central European countries engage with China, before encouraging others to do the same. Given China's numerous business interests in the region, most notably the so-called Belt and Road Initiative (BRI) focused on infrastructure projects, any kind of European pushback is unwelcome in Beijing.
Then in November, Lithuania became the first country in Europe to allow self-ruled Taiwan to open a de facto embassy under the name "Taiwan." Other such offices in Europe and the United States use the name Taipei, Taiwan's capital, to avoid references that would imply the island's independence from China. Taiwan's Foreign Ministry said the opening of the Taiwanese Representative Office in Vilnius would "charter a new and promising course for bilateral relations between Taiwan and Lithuania."
The move enraged Beijing, which saw it as an affront to its "One China" principle that insists Taiwan is part of China, rather than an independent sovereign territory, despite the two sides having been governed separately for over seven decades after a civil war. As a rule, those who want a relationship with China must recognize the policy diplomatically.
Lithuania says the new Taiwan office does not have formal diplomatic status and does not conflict with its One China policy. But Beijing reacted by immediately downgrading diplomatic relations with Vilnius. Lithuania also claimed that China has prevented Lithuanian goods from entering China, effectively creating a trade barrier. The Chinese government has repeatedly rejected these claims, blaming Lithuania for harming China's "core interest" and sending bilateral ties to a deep freeze.
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Taiwan reacted by buying up Lithuanian produce that was destined for China -- including 20,400 bottles of rum -- and pledging to invest hundreds of millions of dollars in Lithuanian industry to support the country in the face of Chinese pressure.
The spat has pulled in the European Union, which is backing member state Lithuania. Brussels sees Beijing's treatment of Lithuania as a threat to other EU nations, many of whom have deeper economic links with China and would like to deepen them further.
On Thursday, the EU launched a case against China at the World Trade Organization, accusing Beijing of "discriminatory trade practices against Lithuania, which are also hitting other exports from the EU's Single Market."
The WTO case could be just the start of the EU taking a more hardline stance on China, though there are reservations about whether doing so could prompt Beijing to retaliate in the form of trade wars or canceled investments in Europe.
'China needs to learn lessons'
In 1990, Lithuania became the first member of the Soviet Union to declare independence from Moscow's ruling Communist Party. It then joined the EU European Union and NATO in 2004 -- the very organization intended to be a check on socialist expansion.
In that context, a nation like China displaying aggression in its own region, notably against Taiwan -- as well as using trade as a weapon against smaller European nations -- naturally alarms those who remember life under Soviet rule.
"China needs to learn lessons because until now, they have been allowed to behave in a way that doesn't adhere to our values and rules, simply because they were so wealthy," Lithuania's former Prime Minister Andrius Kubilius told CNN.
"I don't see that bigger EU countries would have taken it upon themselves to stand up. Maybe from Lithuania it will spread to others and in time, Europe will stand united against a country that doesn't meet our standards," he added.
One of the reasons Lithuanian officials may be more comfortable than some nations in taking this stance is that China is a relatively small export market for the country. Only 1.18% of Lithuania's exports went to China in 2019 -- compared with 13.1% to Russia and 3.64% to the US -- though China is also one of
For Lithuania, this hardline stance is more than a moral mission. Officials who spoke to CNN say that by standing up to China, they also hope to send a message to Moscow.
Velina Tchakarova, head of the Austrian Institute for European and Security Policy, explains that Lithuania has "been under permanent Russian pressure since joining NATO. Lithuania wants to set an example within the European members that no one will succumb to autocratic regimes in Beijing and Moscow."
Lithuanian officials told CNN they hoped standing up to China might set a precedent in the EU for pushing back on autocratic regimes. One senior Lithuanian diplomat said the endgame was for Europe to have more effective anti-coercion measures.
Brussels recently proposed a legal mechanism that would allow the EU to respond to economic intimidation in a "structured and uniform manner" by using a "tailor-made and proportional response for each situation" which could include tariffs, restricting imports and limiting access to the EU's internal market.
But many of the smaller EU nations are privately skeptical that their fellow member states -- especially those who trade extensively with China -- would back them when push comes to shove.
A strong economic relationship with China is a key plank of the EU's drive for "strategic autonomy," a term used in Brussels to describe the EU becoming more independent from US influences as a geopolitical power. The thinking was that by partnering with Beijing economically, Europe could act as a bridge between the US and China, while not getting squashed between the two.
The building which houses the Taiwanese Representative Office is pictured in Vilnius in November 2021.
Bigger member states, most notably France, have been strong supporters of the strategic autonomy drive. And while European politicians have grown increasingly uncomfortable with China's treatment of Uyghur Muslims, suppression of democracy in Hong Kong and aggression towards Taiwan, when it comes to hard cash, many European countries are not quite ready to alienate China.
Tchakarova believes that by "bringing China into the debate, Lithuania seeks to strengthen the US position in Europe, but also to warn Brussels and key member states (Germany and France) of the potential risks and dangers associated with bilateral relations with China in the future."
Essentially, they hope to force these countries to take a stand. So, will it work?
A delicate balance
Some in Lithuania think their hardline stance has already produced results. Officials point to the fact that France has backed them, along with the rest of the EU, and called on China to deescalate the situation. This is particularly significant right now, since France holds the EU's rotating presidency and is also in the middle of a presidential election campaign. Earlier this month, Slovenia announced that it too would seek to increase trade with Taiwan.
One senior European Commission official told CNN Brussels' position is that Lithuania has not gone against its One China policy, and that if China continues to be hostile, it must provide evidence that the policy has been breached, which Lithuanian officials are chalking up as a victory.
However, not everyone, even in Lithuania itself, thinks the strategy has been a wholesale success.
President Gitanas Nauseda said that while he supported opening the Taiwanese Representative Office, he thinks the name was needlessly provocative and Lithuania must now deal with the "consequences."
Beijing responded by saying acknowledging the mistake was a good start, but still believes Lithuania to have broken the One China principle.
Brussels has been getting its act together on geopolitical matters lately. After years of bitter backbiting, it may be that Brexit and the pandemic have reminded EU leaders that unity in areas of mutual interest means even small nations like Lithuania can use the mechanics of the EU to stand up to one of the richest, most powerful nations on earth.
Whether Lithuania's stand -- and the EU taking a stand along with it -- will result in any concessions from Beijing is another matter. A recent editorial in the outspoken nationalistic state-run tabloid Global Times issued a series of steps Lithuania must take to restore relations, and warned: "no matter what tricks they play, China will never give in half an inch on issues of principle."
But experts agreed the only chance, however remote, of forcing any concessions from China on the issue is for Europe to present a united front.
Benedict Rogers, a longstanding human rights campaigner and the chief executive of Hong Kong Watch, says that while "China has shown it is very adept at divide-and-rule and able to play countries off another... when countries stand together and stand up against China together, Beijing's bullying tactics are less effective and pressure on China can have more impact."
For all this may seem a small spat, what's at stake is years of work in which the EU has tried to find a way to reconcile its economic relationship with China with its duty to member states and its moral values. The question is for how much longer that balance can hold.
Sino-Lithuanian relations date back to 1921, when the Republic of China recognized independent Lithuania until the latter's occupation and subsequent annexation by the Soviet Union in 1940. Modern diplomatic relations between Lithuania and the People's Republic of China were officially established on 14 September 1991, following the official restoration of Lithuanian independence. Neither the PRC nor the ROC recognized the incorporation of Lithuania into the Soviet Union.
In 1992, the PRC's embassy was established in Vilnius, and in 1995, the Lithuanian embassy was established in Beijing.
In August 2021, the ROC opened its representative office in Vilnius under the name of 'Taiwanese', with the Lithuanian office in Taipei to open by the end of 2021. In the opinion of the Chinese government, Lithuania has thus reneged on its 1991 agreement with PRC on the establishment of diplomatic relations where Lithuania recognized the One China principle; Lithuanian government does not consider being in breach of the agreement. In response, the PRC recalled its ambassador in Vilnius, Shen Zhifei, and demanded that Lithuania recall its ambassador in Beijing, Diana Mickeviciene. Trade between the two countries were also seriously disrupted. Relations between the PRC and Lithuania were downgraded to the level of chargé d'affaires on 21 November 2021.
On 3 December 2021, Lithuania reported that in an escalation of the diplomatic spat over relations with Taiwan, China had stopped all imports from the Baltic state. It said Beijing has delisted Lithuania as a country of origin, preventing items from clearing customs, and was rejecting all import applications. As a result of the conflict China pressured Continental AG and other international companies to stop doing business with Lithuania. The spat spilled over to the rest of the EU when China banned the import of goods which contained Lithuanian parts potentially disrupting integrated supply chains in the common market. EU Ambassador to China Nicolas Chapuis supported Lithuania and attempted to intervene on their behalf. The president of the EU Chamber of Commerce in China described the Chinese government's move as 'unprecedented.' In early 2022, reports emerged that German Chamber of Commerce warned Lithuania that German-owned factories will be closed if relations with China are not improved.
Lithuanian President Gitanas Nauseda said in a radio interview in January 2022 that he thought it was a mistake to allow Taiwan to open a representative office using the name 'Taiwan' in Vilnius. These remarks were subsequently widely published across mainland Chinese media that reported Lithuania had admitted its mistake. Chinese foreign ministry spokesman Wang Wenbin said 'Recognizing the mistake is a correct step, but what is more important is to take action, correct the 'One China One Taiwan' mistaken act, and return to the principle of One China.' However, political analysts quoted on the BBC claimed that Nauseda was not suggesting to make any significant change to Lithuanian policy regarding the opening of the office and improving relations with Taiwan, only that he thought it had caused an avoidable diplomatic crisis by using the name 'Taiwan' rather than 'Taipei' or something else as the name for the office in Vilnius.
An independent 2022 poll commissioned by the Lithuanian Ministry of Foreign Affairs showed that the Lithuanian population overwhelmingly opposes the government's policies towards China. Only 13% of Lithuanians view the policies positively. Following the poll results, opposition parties have called on the government to respect popular opinion and repair ties with Beijing. Foreign Minister Gabrielius Landsbergis criticized that the survey question was not worded accurately enough, stating: 'Lithuania has de facto never changed its policy on China. China has decided to apply unannounced, most likely illegal measures against Lithuania and the European Union. I would probably ask whether Lithuania should support, agree with the aspiration of Taiwan's people to be called Taiwanese, instead of asking about Lithuania's policy on China.'
Human rights criticisms In June 2020, Lithuania openly opposed the Hong Kong national security law in a statement given at the United Nations Human Rights Council. Later, in May 2021, the Seimas passed a resolution that recognized the Uyghur genocide and called for the PRC's government to revoke the Hong Kong national security law.
In March 2021, the PRC blacklisted Lithuanian MP Dovile Šakaliene because of her comments regarding the state of human rights in mainland China.
On 19 November 2021, group of members of Lithuanian national parliament released an official letter encouraging Lithuania to withdraw from the 2022 Winter Olympics due human rights violations in China. Daina Gudzineviciute, president of National Olympic Committee of Lithuania, released a statement that Olympic games should be politically neutral and confirmed that committee has no plans to boycott the games.
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