Landsbergis to business – not everyone can provide evidence that they have suffered because of China

Trade

Foreign Minister Gabrielius Landsbergis says that the government is not changing its position towards China and is confident that intensified economic relations with other South-East Asian countries will help compensate for the losses Lithuania has suffered since Beijing became upset with Taiwan’s establishment of a mission in Vilnius, Eglė Samoškaitė writes in TV3.lt

On Thursday, Mr Landsbergis participated remotely in a meeting of the Social Democratic Party of Lithuania’s faction, where he answered questions on Lithuania’s foreign policy. The main topics discussed were the damaged relations with China and how Lithuania will make up for the losses. However, the Minister himself was very optimistic.

 “As you know, Lithuania’s dependence on China, on trade with China, is not that great, and the measures taken by China have largely caused more disruption than significant damage. If you remember, there were some discussions about slowing down the expansion of some investors, and this information was very worrying. Still, we can already see that these investors are expanding their activities in Lithuania,” Mr Landsbergis said at the meeting.

In this case, the Minister was probably referring to the German car parts giant Continental, which was pressured by the Chinese not to use components made in its Lithuanian plant. However, the company has announced that it will not change its plans to hire about 300 more workers in Kaunas.

 “It is difficult to separate the wheat from the chaff when there is a lot of information flow. The intentions of those driving that traffic can also be very different. Some see, perhaps, an opportunity to ask for some tax breaks from the government simultaneously, even though their dependence on China is non-existent. Tax breaks appeal to everybody, and why not fight for them? It needs to be looked at very carefully to see that they are actually suffering damage and what that damage might be in the future,” Landsbergis said at the meeting, partly casting a shadow over some Lithuanian businesses.

The Minister said that in the immediate aftermath of the undeclared Chinese sanctions, the Lithuanian Ministry of Foreign Affairs sought to help each business in difficulty individually. For example, a hotline was set up so that businesses could report problems directly, and a search was made for where to divert cargo that was stuck. “Most of the cargo was taken over by Taiwan, so it is difficult to talk about damage because the cargo, although not to the seller, reached the buyer,” said Mr Landsbergis.

According to Mr Landsbergis, the Ministry is currently working to clarify the extent of the problems faced by laser manufacturing companies. The politician said that some companies that publicly talk about large losses are struggling to justify those losses. “We deal with this a lot in the Ministry. From the very beginning, when it was announced that there were problems, we were asked to declare the problems because we also declared them at the Directorate of Trade in Brussels because of the case at the World Trade Organisation. And some of those public speakers could not produce the documents to back up their public statements. So this is a thorny issue,” the Minister explained.

Mr Landsbergis questioned why China had been chosen as a partner for the sale of laser production when, for example, Australia was also happy to buy it, but the volumes were very low. The politician said that there were many questions about why Lithuanian businesses did not choose Australia but instead chose China, and in an area closely related to the military industry. 

Social Democrat MPs pressed the Foreign Minister on the damage to Lithuania from the opening of the Taiwanese mission and asked about the search for new markets. Mr Landsbergis recently visited Singapore and Australia. Lithuania intends to establish a diplomatic mission focused on developing economic relations in Singapore.

Mr Landsbergis says that the Lithuanian governments have made great efforts to open up the Chinese market and have only reached an export level of €300 million. This is not bad, but exports to Singapore, without any diplomatic representation at all, amount to around €220 million.

“If we set up an embassy that is focused on promoting trade links, I have little doubt that we will be able to compensate for and surpass the possible uncertainties that were in China,” the Minister said.

Hints at talks “with the other side”

The Foreign Minister explained that for him, a values-based foreign policy includes Lithuania’s right to react to various things without deviating from its values-based posture. According to Landsbergis, such important values include the principle of the inviolability of borders and the ability to protect the rights of individuals or national minorities. The Minister explains that Lithuania has started down this path after establishing stronger ties with Taiwan.

As is well known, Lithuania, unlike other countries in the world, has allowed a business representative office on this island to be named after Taiwan in Lithuania, even though there are Taipei representative offices everywhere else. Chinese counterparts claim that renaming the representative office to Taipei would help improve the frayed relations between Vilnius and Beijing. Still, Lithuania is currently only considering unifying the name of the representative office in Mandarin, Lithuanian and English. In English and Lithuanian, it sounds like the Taiwanese Mission, while in Chinese, it sounds like Taiwan. China is particularly sensitive to any manifestation of Taiwanese statehood because it considers the island part of itself.

“The reaction we have received from China is economical. However, it is a burden on businesses and so on. This justifies the fact that we naturally need additional export and import partners to ensure the security and stability of our supply chains. Therefore, it seems to me that it is only logical that, without taking away from the opportunity and the need to react to what is important for our country, we build a broader network of partnerships,” said Landsbergis. 

Asked about the de-escalation plan with China presented to President Gitanas Nausėda, the Minister said that the project was more about positioning. Still, he did not want to discuss it in more detail because publicity always weakens negotiating positions. However, he also referred indirectly to talks “with the other side”.

“If there is some kind of conversation, I would not like to call it a negotiation, with the other side, disclosing the positions of the conversation weakens the negotiator’s or the interlocutor’s position,” said Mr Landsbergis.

In this case, it should be understood that Lithuania is considering various options to respond to China’s outrage. However, Lithuania has not seemed inclined to change the name of the Taiwanese mission to Taipei.

Asked whether he communicates with Chinese representatives at any level in a bilateral format, Mr Landsbergis blamed China.

“For me, the most disappointing thing was that the space for diplomatic discussion was reduced on the initiative of China. The first step was that the Chinese ambassador to Lithuania was recalled. Our ambassador was asked to recall our ambassador, and Diana Mickevičienė now still works from Vilnius. And the last step, which was a huge one, which has not been used in diplomatic practice, to my knowledge, was the withdrawal of the diplomatic cards of our diplomatic mission in Beijing, of the staff of our embassy. They have been suspended. These diplomats had to go to Vilnius for their safety. So that space for diplomatic conversation is minimal. But that does not mean that I would personally refuse any contact, conversation or other means if such opportunities arose. So far, there is no such space”, says Mr Landsbergis.  

The European Union institutions in Beijing currently mediate Lithuania’s contacts with China. According to the Minister, this is a good channel to remind China that Lithuania is a large and powerful community member.

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