For Lithuanian peat exporter Kazimiras Kaminskas, a resolution of the dispute with China cannot come soon enough as his business is hit by what the government calls Beijing’s “undeclared sanctions”.
Kaminskas, who heads up Klasmann-Deilmann Lietuva, has around 200 containers loaded with peat substrates that are stuck in several Chinese ports.
“When we try to clear customs and choose the country Lithuania, the system says there is an error,” Kaminskas said. “For the moment, we have stopped exports to China, until the situation becomes clearer.”
The dispute with China started in July last year when Lithuania allowed Taiwan to open a diplomatic outpost in Vilnius. The move outraged Beijing, which does not recognise Taiwan as a country.
Lithuanian business leaders have since accused China of disrupting trade in retaliation and the EU on Thursday launched a case against Beijing accusing it of economic coercion at the World Trade Organisation (WTO).
Just 1% of Total Exports
Lithuania exported 320 million euros ($358 million) worth of goods to China in 2020 – mainly cereals, wood and wood products and furniture.
That represented only about 1% of total exports as Lithuania’s main markets are much closer to home – Russia, Latvia, Poland and Germany.
But employer groups say the effects of China’s actions have been more far-reaching, hitting supply chains that include Lithuanian companies. “China is a big market with huge potential and we understand that everyone in the world is linked to China,” Kaminskas said.
There has also been an effect on imports from China, valued at around 1.25 billion euros in 2020.
The director of a high-tech company said he is still waiting for a shipment that had been due to leave Chinese ports in October. “They say ‘we can’t ship it’, systems do not allow to complete export declaration in the customs,” he said.
The company is now seeking to ship the equipment through neighbouring Latvia. “We are stuck,” he said. “We planned to increase production from the new year, but now I don’t even know when we will get the equipment.”
- AFP, with additional editing by George Russell
READ MORE:
US Trade Chief Voices Support for Lithuania amid China Coercion
Lithuania Said to Cancel China Bridge-Building Contract
Taiwan To Set Up $200 Million Lithuania Investment Fund
