Lithuania angered Beijing by letting Taiwan's office in Vilnius bear the name Taiwan instead of Chinese Taipei.
Taiwan is creating an investment fund and planning other measures to help Lithuania as it faces major economic pressure from China for allowing the island to open a representative office in the European Union country, Taiwanese officials said on Wednesday.
“The $200 million (€177 million) fund will be used for investments into the Lithuanian economy and help its business, primarily into semiconductors, laser technology, biotech and other key industries," Eric Huang, representative of the Taiwanese mission to Lithuania, told reporters in the Baltic nation's capital of Vilnius.
Lithuania broke with diplomatic custom by agreeing that the Taiwanese office in Vilnius would bear the name Taiwan instead of Chinese Taipei, a term used by other countries to avoid offending Beijing. China considers Taiwan part of its territory with no right to diplomatic recognition.
The office, a de facto embassy, opened in November, and Lithuania is planning to open its own trade office in Taiwan later this year. It has infuriated China, which withdrew its ambassador to Vilnius and expelled the Lithuanian ambassador to Beijing. Lithuania, a member of the EU and NATO, has closed its embassy in Beijing over the dispute.
The EU has meanwhile accused Beijing of retaliating against Vilnius by refusing to clear customs for products made in Lithuania or any other EU product that has components made in the small Baltic country.
Taiwan said it is ready to help Lithuania in resupplying trade, with the island saying "there are more than 120 sea containers — at least 1.5 million-euro worth — blocked by Beijing. We’re ready to take all of those and help Lithuanian companies."
Chinese foreign ministry spokesman Zhao Lijian has called it “false news” that Beijing has blocked Lithuanian imports or pressured multinational companies that do business with the EU country.
“If there’s a problem with any products’ export to China, the enterprises concerned can report it to the Chinese authorities through normal channels. The individuals in the EU should respect facts and stop making irresponsible remarks,” Zhao said late last month.
He added that Lithuania “seriously damaged the political basis of our diplomatic relations” and that he has “heard that some Chinese enterprises no longer see Lithuania as a trustworthy partner.”
Lithuanian President Gitanas Nauseda said on Tuesday that using the Taiwan name for the mission was a mistake and expressed regret that the step was not coordinated with him. He didn’t, however, say he disapproved of the actual opening of the Taiwanese mission in Lithuania.
Taiwan Deputy Foreign Minister Harry Tseng defended the decision by Lithuanian politicians.
“There is a significance in the name. Taipei only represents a city, a capital. Taiwan has a more clear definition. There is no violation of any laws calling our country Taiwan,” he said.
Lithuanian Prime Minister Ingrida Simonyte on Tuesday discussed the tense situation with European Commission President Ursula von der Leyen, who later in a tweet pledged the EU's support to the Baltic country of 2.8 million in “current trade irritants with China."
Washington has also publicly supported Vilnius. Anthony Blinken, the US Secretary of State told reporters on Wednesday during a joint press conference with Germany's foreign minister that "we have immediate concern about the Government of China's attempt to bully Lithuania."
"China is pushing European and American companies to stop building products with components made in Lithuania or risk losing access to the Chinese market, all because Lithuania chose to expand their cooperation with Taiwan."
"The United States will work with our allies and partners, including Germany, to stand up against intimidation like this from China by strengthening our economic resilience, diversifying our supply chains, and countering all forms of economic blackmail," he added.
Annalena Baerbock stressed meanwhile, that Germany "as Europeans stand in solidarity at Lithuania's side."