The European Union angered China on Thursday by launching a case against Beijing at the World Trade Organization (WTO) for targeting Lithuania over its stance on Taiwan.
The Brussels move was a further deterioration in relations between China and the bloc, with a long-negotiated investment deal already on the rocks after the two sides exchanged tit-for-tat sanctions.
The latest dispute is over Lithuania, one of the smallest countries in the European Union, which made waves in July when it allowed Taiwan to open a diplomatic outpost in Vilnius.
The move angered Beijing, which does not recognize Taiwan as a state and considers the self-governing democratic island a rebel territory of the mainland.
“Initiating a WTO case is not something we take lightly,” EU trade chief Valdis Dombrowski said in a statement.
“However, after repeated failed attempts to resolve the issue bilaterally, we see no other way than to request a WTO dispute resolution consultation with China,” he said.
The European Commission handles trade policy for the 27 member states of the European Union and leads the conflicts at the WTO in Geneva, even though they involve a single state.
Going to the World Trade Organisation, the European Union supported allegations by Lithuanian business leaders and officials that the line resulted in China blocking imports from Lithuania and other economic sanctions.
The move on Thursday launched a 60-day window for resolution of both sides before the dispute was taken to a panel.
Beijing reacted bitterly to the move, calling the allegations of “so-called” Chinese coercion “baseless and inconsistent”.
“The issue between China and Lithuania is political, not economic,” Chinese Foreign Ministry spokesman Zhao Lijian said.
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