For a moment in the middle of this week it looked like the dispute between Lithuania and China eased: The name of the country reappeared in the Chinese customs system, from which it had disappeared last week, as if Lithuania no longer existed.

But hope was deceptive.

Friederike Böge

Political correspondent for China, North Korea and Mongolia.

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Thomas Gutschker

Political correspondent for the European Union, NATO and the Benelux countries based in Brussels.

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Reinhard Veser

Editor in politics.

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Because China is actually increasing the economic pressure on Lithuania step by step.

According to a report by the Reuters news agency, international companies are now in danger of excluding them from the Chinese market if they do not sever their business relations with Lithuania.

Lithuanian deputy foreign minister Mantas Adomenas and the chairman of the Lithuanian industrialists' association Vidmantas Janulevicius confirmed to the agency that foreign business partners of Lithuanian companies had been put under pressure.

According to Adomenas, the first foreign companies have terminated contracts with Lithuanian business partners.

Does the EU have a means?

Beijing is taking action against Lithuania because a Taiwan representative office was opened in the capital Vilnius in November. The announcement of this step in the summer had already led to China withdrawing its ambassador from Vilnius and forcing the Lithuanian ambassador in Beijing to leave. After opening the Taiwanese office, China then unilaterally downgraded diplomatic relations to the level of business agents. The Lithuanian embassy in Beijing is now faced with the threat of only delivering diplomatic mail, i.e. official documents from Vilnius, if the addressee is not the embassy but the “Chargé d'Affaires office”.

The Chinese regime is particularly angry that the name of the island to which Beijing claims appears in the name of the Taiwanese representation in Vilnius. Chinese propaganda media have made it clear that it is now a matter of setting an example in Lithuania. Last week, China began blocking imports of Lithuanian goods without officially announcing it. This week, according to a report by the news portal "15min.lt", Lithuanian companies reported that deliveries to Lithuania from China would no longer be let out; these are goods that have already been paid for.

This step hit Lithuania harder than the blockade of its exports to China, which are only minor. For many of the Chinese goods, other sources of supply are difficult to find, quoted the Lithuanian news portal "Unternehmer". The pressure on foreign business partners of Lithuanian companies is even more dangerous for the country. Because its economy depends to a large extent on supplying larger companies with products.

The European Union, which initially stayed out of the conflict between Lithuania and China, took a clear position on Wednesday on the trade barriers set up by China. "The EU is ready to defend itself against all kinds of political pressure and intimidating measures that are used against a Member State," said EU foreign policy chief Josep Borrell and Vice-President Valdis Dombrovskis, who is responsible for trade. How the relationship between China and a member state evolves has an impact on China's overall relationship with the EU.

An hour earlier, Dombrovskis had presented a new instrument with which the EU Commission can react to economic blackmail.

If the states and the EU Parliament agree - whatever it looks like - the Commission could restrict access to the internal market, prohibit investments or impose tariffs.

The instrument is not directed against a specific country, but the Latvian Commissioner mentioned China's action against Lithuania as a possible application during the presentation.



Beijing, on the other hand, seeks a trial of power with the EU by blackmailing international corporations into breaking off business relations with Lithuania.

The party newspaper “Global Times” confidently wrote that it was unlikely that the EU would start a dispute with China over Lithuania.