Lithuania shows that China’s compulsory trade strategy is difficult to fight back

The door to the Chinese market has been closed for two weeks closure Lithuanian product.

The problems of the Baltic countries, which account for only 0.2% of global exports, are trivial to the rest of the world. But this is just the latest example of China wielding a weapon that other countries have yet to find a shield: a strategy of compulsory economic governance.

Beijing has always targeted foreign companies or industries to “punish” policies that its government disagrees with. Measures include a suspension of rare earth exports to Japan after maritime conflicts in the disputed Senkaku Islands, restrictions on Norwegian salmon imports after the Nobel Peace Prize was awarded to dissident Liu Xiaobo, and bans on the import of Australian wine and barley in retaliation. Canberra requested an investigation into the origin of Covid-19.

Similarly, after Lithuania allowed the Taiwan representative office to be opened in Vilnius, it disappeared from the national list of the General Administration of Customs of China on December 1, preventing the company from submitting customs documents.

“Every country uses economic coercion in some way—the United States has a complete sanctions regime,” said Emily Kilcrease of the Center for New American Security, a think tank in Washington.

However, she pointed out that democracies are at a disadvantage: under its authoritarian system, Beijing can target companies or products without invoking any relevant laws to justify its actions.

When South Korea deployed the US anti-missile system in 2016, Chinese travel agencies stopped traveling to South Korea, and the Chinese public began to oppose Korean pop songs and soap operas. In both cases, it is difficult to hold the Chinese government accountable.

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“This kind of wide-ranging off-book measures in China are not available to the United States or other democracies because they return to the party’s control of the economy,” said Kilcrease, who is a co-author of the new paper. Report How other countries respond to China’s economic coercive economic governance strategy. “In the United States, we are bound by the authority of existing laws.”

It may take years for the dispute settlement mechanism of the World Trade Organization to produce results, and it may not even be an option, because the government lacks evidence to prove that the Chinese authorities support boycotts or interruptions in imports.

A week after the initial export was blocked, Lithuania’s name appeared again on China’s customs menu. However, Lithuanian goods have not yet been cleared.

“Customs brokers will receive’error’ reports from the IT system when they try to handle the goods. This is true for different ports and all types of products,” the European Commission said, adding that Chinese companies also canceled without explanation. Orders for Lithuanian products.

Observers say Beijing wants to warn others. Shi Yinhong, a foreign policy expert at Renmin University of China, said that both Lithuania and Australia are dismissive of Beijing. “But not taking punitive measures will increase the possibility that other countries will adopt similar measures such as establishing relations with Taiwan, and it will be difficult to explain to the domestic people,” he said.

The European observer agreed. Joerg Wuttke, president of the European Union Chamber of Commerce in China, stated that these measures “have no direct impact on multinational companies” because there is almost no procurement from Lithuania. “But this is a severe warning to other EU countries not to follow the example of Lithuania,” he said. “For example, the economies of the Czech Republic and Slovakia are deeply integrated into the German automotive supply chain.”

Central European countries have recently strengthened their contacts with Taipei, as the region’s enthusiasm for the benefits of a close relationship with China is rising. Weaken.

The EU threatened that if all obstacles preventing Lithuanian exports from entering the Chinese market are not eliminated, it will bring China into the WTO.Brussels also has came up with An “anti-coercion tool”, it hopes the EU will use it to retaliate against this economic coercion.

But analysts are skeptical, because China’s status as the world’s second-largest economy gives it tremendous influence.

Even its punitive measures often cause some damage in the country. Shi predicts: “China’s countermeasures against these countries will become more frequent and stronger.”

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