Before Lithuanian products, the gate to China closed in early December when the Baltic country decided to allow Taiwan to open a trading office in Vilnius. With Lithuania’s exports accounting for only 0.2 percent of the world’s exports, the issue seems insignificant, but it highlights what countries can expect that feel they should not over-see Beijing’s blessing. Financial Times Catherine Hill, publicist for the Financial Times.
The Chinese leadership is punishing companies and industries for being unhappy with the behavior of their governments. A series of examples could be started with the halting of the export of rare earths for technical equipment to Japan due to a dispute over the ownership of an island. Norwegian salmon imports have been halted due to a Chinese opposition winning a Nobel Prize, as well as Australian wine imports and prices because the Australian government will support an independent investigation into the origins of the coronavirus pandemic.
Lithuania was removed from the list of China Customs Service countries after the opening of the Taiwan office, making it impossible for Baltic companies to carry out the paperwork required for their export. Each superpower has its own methods of economic sanctions, and the United States has an entire system with different levels of restrictions, says Emily Kilkris, an analyst at the Center for Research on a New American Security in Washington.
However, he adds, there is a difference between authoritarian and democratic states. Beijing does not feel the need to justify or even publicly commit to imposing economic restrictions. When South Korea installed a US anti-missile system in 2016, Chinese travel agencies stopped organizing corporate flights to South Korea that were difficult to link to the Chinese government.
Kilkris says that democratic countries will not be able to use such popular methods because they can be held publicly accountable by their governments. If a country turns to the World Trade Organization (WTO) because of a trade dispute, it will have to prepare for years of action, while steps similar to the first or the method used against Lithuania will immediately pay off.
In the case of Lithuania, Lithuania reappeared from the customs registry a few days after the country name was deleted, but customs officials reported receiving error messages from the IT system if they tried to do something. This is not the case in all ports and for all cargo.
Experts say Beijing already intends to take these steps as a warning. Shi Yinhong, a lecturer in foreign affairs at Renmin University, points out that both Australia and Lithuania are resisting Chinese pressure, but if the Chinese leadership does not take punitive measures, other countries may feel it is beneficial to open a Taiwanese trade representative, which would then be It’s hard to explain to a local audience
The decision on Lithuania does not affect multinationals because it does not have an important relationship with the small country, but it is a clear warning to all EU member states not to follow the Lithuanian model, says Jörg Wotke, president of the EU China Chamber of Commerce. . The Czechs and Slovaks plan similar facilitation with China, but they are deeply integrated into the German car production chain, so Beijing could be a serious problem if it starts punishing them. The European Union has turned to the World Trade Organization over the Lithuanian-China dispute, but experts say they can hardly achieve anything due to methods unaccountable to the Chinese government.
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