Lithuanian industry warns of € 300 million loss due to Chinese pressure

According to the information at his disposal, more than 1,200 containers with a total value of about 240 million euros are not transported to Lithuania. If the situation does not change, the most pessimistic scenario assumes that next year, due to Chinese restrictions, the losses of Lithuanian companies could reach 300 million euros.

China has so far denied any obstacles to doing business with Lithuania, as restrictions on exports to Lithuania currently affect only industrial goods, the president of LPK said.

“The movement of consumer goods and non-industrial goods continues. The problem is with industrial goods, such as various components and microelectronic components that are inserted into devices manufactured in Lithuania,” he told BNS.

“If supplies continue to be disrupted, companies will have to stop production because the end product cannot be made without these parts,” Janulevich explained.

He acknowledged that Lithuania is currently experiencing unprecedented pressure from China, which it will not be able to withstand alone.

“Industrial raw materials – various raw materials and components – account for two-thirds of the € 1.2 billion worth of goods exported from China to Lithuania,” said the head of the Lithuanian Industrial Association.

“Preliminary estimates suggest that if the situation continues, Lithuanian companies will lose around € 300 million a year next year,” he added.

On Wednesday, LPK called on senior Lithuanian officials to react immediately to China’s actions against the country and its companies, including involving the European Union (EU) institutions.

In a letter, the confederation acknowledged that it had not yet felt the EU’s involvement or support for Lithuania and its companies.

The German-Baltic Chamber of Commerce has also recently warned the Lithuanian government that restrictions imposed by China could force German investors to close production facilities in Lithuania if no solution is found to improve Lithuanian-Chinese economic relations.

It has already been reported that Beijing has been putting recent economic and diplomatic pressure on Lithuania in response to Vilnius’ decision to allow Taiwan to establish a representation in Lithuania under the name “Taiwan” as China seeks to prevent any attempt by Taiwan to act as an independent state.

Elsewhere in the world, such representations use the name “Taipei” as Taiwan’s capital, in line with Beijing’s “one China” policy, which does not allow Taiwan to be considered a separate country.

For this reason, the two countries recalled their ambassadors for consultations this year, but diplomatic relations were later reduced to the level of temporary envoys.

China has recently abolished direct freight train journeys to Lithuania and issued food export permits to Lithuanian companies, reduced credit limits for Lithuanian companies and raised prices, and temporarily excluded Lithuania from its customs system.

Lithuanian businessmen acknowledge that these disagreements have made their cooperation with China significantly more difficult, but the Lithuanian government hopes that closer economic ties with Taiwan could offset these losses over time.

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