FILE PHOTO: A view of different flags of the European Union Members during a debate on Poland’s challenge to the supremacy of EU laws at the European Parliament, in Strasbourg, France, October 19, 2021. Ronald Wittek/Pool via REUTERS
January 27, 2022
BRUSSELS (Reuters) -EU authorities launched a challenge at the World Trade Organization (WTO) on Thursday, accusing China of discriminatory trade practices against Lithuania that they say threaten the integrity of the bloc’s single market.
China has downgraded diplomatic ties with Lithuania and pressured multinationals to sever links with the Baltic state after it allowed Taiwan to open a de-facto embassy in Vilnius.
China, which said the dispute was political rather than economic and labelled Lithuania’s actions an attempt to “hijack” EU-Beijing relations, regards self-governed Taiwan as its own territory.
The European Commission, which oversees European Union trade policy, said in a statement that China’s actions were harming exporters in Lithuania and elsewhere in the bloc.
The curbs include a refusal to clear Lithuanian goods through customs, rejection of import applications from Lithuania and pressure on EU companies to remove Lithuanian content from supply chains when exporting to China, the Commission said.
The Commission said China’s customs statistics showed a 91% drop in trade from Lithuania to China in December as compared to the same month in 2020, with the most affected sectors being pharmaceuticals, lasers, electronics and food.
The EU executive said those actions appeared illegal under WTO rules and that attempts to resolve them bilaterally had failed.
“The EU is determined to act as one and act fast against measures … which threaten the integrity of our single market,” EU Trade Commissioner Valdis Dombrovskis said. Diplomatic efforts were also being pursued, he added.
WTO challenges start with a formal 60-day period of consultations between the parties. If they do not resolve the dispute, the EU can request that a WTO panel rule on the matter. The WTO typically take years to resolve disputes.
Dombrovskis told reporters the EU was trying to find an amicable solution during the consultation period.
In Beijing, the foreign ministry said China acted in accordance with WTO rules and its issue with Lithuania was political.
“We remind the EU to … be wary of Lithuania’s attempt to hijack China-EU relations,” ministry spokesman Zhao Lijian told a news briefing.
Lithuanian officials are discussing whether to ask their Taiwanese counterparts to modify the Chinese translation of the name of Taiwan’s Representative Office, two sources told Reuters on Tuesday https://www.reuters.com/world/asia-pacific/lithuania-considers-modifying-taiwan-representation-name-defuse-row-with-china-2022-01-25.
When asked about the possible change of name, Dombrovskis said: “There can be diplomatic solutions, and also from the EU side we are facilitating and trying to resolve this dispute amicably.”
Taiwan said it had not received a request to change the name.
(Reporting by Philip Blenkinsop and Sudip Kar-Gupta; Additional reporting by Yew Lun Tian in Beijing, Francesco Guarascio and Benoit Van Overstraeten; editing by John Stonestreet and Raissa Kasolowsky)
