Taiwan pledges further $1 billion Lithuania investment amid China row

Taipei is supporting its diplomatic ally Vilnius in the face of growing economic pressure from Beijing

Andrius Sytas
Tuesday 11 January 2022 15:18
<p>File photo: A plaque at the Taiwanese Representative Office in Vilnius, Lithuania, 18 November 2021</p>

File photo: A plaque at the Taiwanese Representative Office in Vilnius, Lithuania, 18 November 2021

Taiwan will launch a $1 billion (£736,000) credit programme to help fund joint projects between Lithuanian and Taiwanese companies in six business categories, a government minister said on Tuesday.

Lithuania is under pressure from China, which claims democratically ruled Taiwan as its own territory, to reverse a decision last year to allow the island to open a de-facto embassy in Vilnius under its own name rather than going by Taipei.

Taiwanese representations in other countries, except the unrecognized Somaliland, are named after Taiwan’s capital Taipei.

China has downgraded diplomatic ties with Vilnius, and is pressuring companies, such as German car parts giant Continental to stop using Lithuanian-made components. It has also blocked Lithuanian cargos from entering China.

Taiwan last week announced plans to set up a separate $200 million fund to invest in Lithuanian industries and boost bilateral trade as it tries to fend off China’s diplomatic pressure on the Baltic state.

"The investment and credit funds will help us strengthen the cooperation," Taiwan’s National Development Council Minister Kung Ming-hsin told an online news conference.

The credit fund will focus on developing semiconductor talent and facilitating semiconductor development, as well as biotechnologies, satellites, finance and scientific research, said Kung.

Lithuania’s Economy and Innovations Minister Ausrine Armonaite said her country planned to open a trade representation office in Taiwan in the spring.

"Taiwanese companies are in need of laser projects, hopefully our laser companies will soon find partners in Taiwan and we will be very happy to facilitate the partnership", she said.

Last week, a Taiwanese government-owned company announced it had bought a shipment of more than 20,000 bottles of Lithuanian rum after learning China would reject it.

Taiwan has also redirected 120 shipping containers from Lithuania blocked by China into its market, and will take “as much as possible” more, the government said.

US diplomats have expressed strong support for Lithuania, calling China’s pressure "economic coercion".

Lithuania’s Foreign Minister said he would discuss the Chinese pressure with his European Union counterparts on Friday.

Beijing has said that Lithuania’s growing diplomatic ties with Taiwan contradict the EU-proved “One-China” policy, which doesn’t recognise Taiwan as a state.

China is concerned about Western efforts to carve a bigger role for Taiwan on the world stage, and that other countries would follow suit if Lithuanians did not face the consequences for opening Taiwan’s diplomatic outpost.


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