As part of its efforts to fend off Chinese diplomatic and trade pressure on Lithuania, Taiwan is set to set up a $200m (£148m) fund to invest in the Baltic state.
In a statement, Taiwan said its first investment will be made later this year in cash guaranteed by the national development fund and central bank of Taiwan.
In an indication of deepening ties between the two countries, Lithuania recently allowed Taiwan to open a de facto embassy there.
China’s diplomatic relations with Lithuania were downgraded a few days later.
“It’s time for us to help you with your challenges,” Taiwan’s deputy foreign minister Harry Ho-Jen Tseng said when announcing the plan.
After purchasing 20,000 bottles of Lithuanian rum bound for China, Taiwan is sharing advice with the public on how to consume and cook with rum.
Taiwan Tobacco and Liquor Corporation bought the rum after learning that it would be banned from entering China, according to state-run media.
China has denied restricting trade from Lithuania, claiming that doing so would violate international trade regulations. However, the European Union has confirmed allegations of goods being held up at Chinese customs. Lithuania’s businesses have reportedly been affected by the rum issue, although China accounts for only 1% of Lithuania’s exports.
Beijing has a history of levying unofficial trade penalties against countries with which it disagrees. Several Australian products, including meat, wine, and barley, have been subjected to boycotts.
China downgraded its diplomatic relations with Lithuania in November after the Baltic state allowed Taiwan to build a de facto embassy there.
To avoid offending China, the new office is dubbed Taiwan rather than “Chinese Taipei,” as many other countries have done.
Although the establishment of a new office in Lithuania does not imply official connections between the two nations, it could be seen as a sign of developing ties. It was the island’s first new diplomatic representation in Europe in 18 years. As a result of China’s coercion, Taiwan has only a few formal allies.
Lithuania affirmed its right to have relations with Taiwan while also stating that it adhered to the “One China” policy.
In diplomatic terms, the one-China policy acknowledges China’s government as the sole government of China. Although Taiwan is a self-governing democratic state, Beijing believes it to be part of its territory. The island has been under increasing pressure to be isolated from its international allies in the last year.
About Taiwan
Taiwan is a country in East Asia, officially known as the Republic of China (ROC). The People’s Republic of China (PRC) to the northwest, Japan to the northeast, and the Philippines to the south share marine borders. Taiwan’s main island, formerly known as Formosa, covers 35,808 square kilometers (13,826 square miles), with mountain ranges dominating the eastern two-thirds and plains dominating the western third, where the island’s densely populated populace resides.
Taipei, along with New Taipei and Keelung, is Taiwan’s capital and the country’s major metropolitan area. Kaohsiung, Taichung, Tainan, and Taoyuan are some of the other significant cities in Taiwan. Taiwan is one of the world’s most densely inhabited countries, with a population of 23.45 million people.