Lithuania will today open its trade office in Taiwan.
The office is part of a July 2021 deal under which the two countries agreed to further their bilateral ties. Its opening follows a decision to open a de facto embassy in Vilnius last November, named the “Taiwanese Representative Office”.
Beijing has seen the naming of this embassy as implicit recognition of Taiwan’s independent status from China, describing the act as “extremely egregious”. They have since downgraded diplomatic relations with Lithuania, with Vilnius stating that there has since been a 91% drop in Chinese imports. In response, the EU launched a case at the WTO in January, accusing China of weaponizing trade, although the Chinese foreign office has denied the claim.
Lithuania’s extension of relations with Taiwan is likely to further anger China to the point that it may place further restrictions on the Baltic state. EU is likely to win its WTO case, meaning that China would have to remove the trade restrictions or face EU retaliatory measures. However, given that the EU imports from China more than double what it exports, there is a risk that such measures could harm Brussels more than they do Beijing.
Laurence is an Analyst and weekly contributor to The Daily Brief, he focuses on geopolitical and economic issues occuring in Europe and Eurasia.