Lithuanian Foreign Minister Gabrielius Landsbergis said businesses in the Baltic nation remained wary about conducting trade with China two years after a diplomatic falling out and a challenge with the World Trade Organization.
“There’s a huge trust issue, not just from the government but from the business as well,” Landsbergis told Bloomberg in an interview on Monday. “Since it has been done in the past, nobody can be sure that it cannot be repeated because it’s a non-rules-based approach.”
Lithuania became embroiled in a dispute with China in 2021 after allowing Taiwan to set up a representative office under the island’s name, a move Beijing regarded as a violation of its sovereignty. China responded by withdrawing its ambassador to Lithuania and imposing an effective trade ban on the European Union member state.
Landsbergis said in a Nov. 18 interview with news organization ELTA that “most” of China’s trade measures targeting Lithuania “have been lifted.”
Asked about the comments on Monday, the minister made reference to measures that were challenged with the WTO. Lithuania had suffered “economic coercion” after being removed from China’s customs system, he said.
Chinese official customs data show little recovery in direct bilateral trade. Imports from Lithuania were down more than 70% in the first 10 months of this year compared to the same period in 2021, before the row broke out.
Trade between Beijing and Lithuania collapsed in the months after the spat, with China only importing $60,000 worth of goods from Lithuania in January 2022, a 99.8% drop from a year earlier. The EU responded on behalf of Lithuania, taking China to the WTO. That case is still pending.
China’s Foreign Ministry reiterated that Lithuania’s action on Taiwan was “wrong” and that its response was “legitimate” in protecting its interests.
“The problem is fundamentally with the Lithuanian side,” the ministry said in a written response. “China has always acted in accordance with WTO rules and will handle relevant issues in accordance with relevant rules.”
Landsbergis was also asked about the prospect of China-Lithuania relations returning to normal.
“The talks about our diplomatic track, they are ongoing for almost two years now, in some cases they are more active, less active,” he responded. “We are having a conversation, which, as I’m saying, with patience, I think that it could provide some opportunities.”
Neither side has officially reinstated its diplomats in the other country.
EU leaders are expected to travel to China next week for an annual summit. Any reduction of tensions with Lithuania may help in removing one point of conflict between the two sides.
There’s also been no change to the name of Taiwan’s representative office in Vilnius, according to the deputy head of the Europe department at the Ministry of Foreign Affairs in Taipei.
“This is a non-issue,” he said at a regular briefing on Tuesday.
--With assistance from James Mayger, Lucille Liu, Samson Ellis, Colum Murphy and Jenni Marsh.
(Corrects to remove explicit reference to China ending trade measures throughout. An earlier version corrected the title of a Taiwanese official in the second-last paragraph.)