In current discussions about China’s economic statecraft, Lithuania’s experience with Chinese economic coercion frequently serves as a prime example, providing valuable lessons for countries that may face similar coercive tactics from Beijing or other countries in the future. However, less attention has been devoted to the lessons that can be gained from the evolving relationship between Lithuania and Taiwan that has grown closer during the 2020-2024 tenure of Lithuania’s center-right coalition government.
This development can be seen as a broader contribution to the efforts made by the European Union (EU) to de-risk from China, and to prioritize diversification through partnerships—particularly with allies and partners in the Indo-Pacific region such as South Korea and Japan. This focus is set to intensify with the return of US President Donald Trump, whose protectionist and isolationist policies have already begun to strain transatlantic relations. Consequently, the EU needs to rely more on partnerships beyond the United States in order to address the economic security and competitiveness challenges posed by Beijing.
In this context, Lithuania’s engagement with Taiwan provides valuable lessons into forging sustainable and prudent relationships with allies and partners in the Indo-Pacific region. While these partnerships present cultural and economic opportunities that could alleviate some of the costs associated with reducing dependency on China, they also underscore the necessity of meticulously assessing the inherent challenges involved.
Lithuanian-Taiwanese Relations: The State of Play
When China launched a coercion campaign in late 2021 following the opening of the Taiwanese representative office in Vilnius, Taiwan stood firm in its support for Lithuania, particularly in agricultural trade and technology. At the outset of the bilateral crisis, Taiwan took measures to mitigate the effects of China’s actions by purchasing goods blocked by Chinese customs and facilitating permits for Lithuanian agricultural and food products. In 2023, Taiwan and Lithuania solidified their collaboration by signing a Memorandum of Understanding (MOU) on Agriculture, leading to the establishment of the Taiwan-Lithuania Agricultural Working Group, which convened twice. That same year, Lithuania’s Leafood and Taiwan’s YesHealth inaugurated the largest vertical vegetable farm in Europe, reinforcing their commitment to innovation in agriculture.
Taiwan also advanced its technological partnership with Lithuania by launching a USD $200 million investment fund to bolster the semiconductor, laser, and biotechnology sectors. Additionally, a USD $1 billion credit program was instituted to foster collaborations between Taiwanese and Lithuanian enterprises. In late 2024, Taiwan’s Foreign Minister Lin Chia-lung (林佳龍) led a delegation to the Drone Industry Business Forum in Vilnius, where two MOUs were signed to enhance cooperation in the unmanned aerial vehicle sector. These initiatives yielded tangible successes: including a USD $14 million deal between Teltonika IoT Group and Taiwan’s Industrial Technology Research Institute (ITRI), and a USD $10 million investment from Taiwania Capital in the Lithuanian fintech powerhouse TransferGo.
Beyond technological cooperation, Lithuania and Taiwan—democracies that have been significantly impacted by foreign disinformation campaigns—are deepening their collaboration in countering information manipulation and enhancing societal resilience. Under the leadership of Lithuania’s Vice-Chancellor and head of the National Crisis Management Centre (NKVC), Vilmantas Vitkauskas, a Foreign Information Manipulation and Interference (FIMI) delegation visited Taiwan to engage in strategic discussions on counter-disinformation practices. The delegation, composed of representatives from government institutions, academia, and NGOs, engaged in high-level exchanges with Taiwanese counterparts, exploring avenues for deeper cooperation in strategic communication and disinformation resilience. Lithuania expressed its readiness to assist Taiwan in developing a comprehensive disinformation counteraction system based on its own successful model. The delegation also encouraged stronger cooperation between Lithuanian NGOs and commercial sector companies with their Taiwanese counterparts, fostering broader engagement beyond government institutions.
As of this writing, Lithuania’s newly elected government, led by the Lithuanian Social Democratic Party (LSDP), has assumed office. Prime Minister Gintautas Paluckas has expressed the necessity of normalizing diplomatic relations with Beijing, which entails restoring ambassadorial-level representation in both capitals. He has also advocated for retaining the current name of the Taiwanese representative office in Vilnius, arguing that a name change would not necessarily lead to improved relations with China. Meanwhile, Foreign Minister Kęstutys Budrys has emphasized the importance of establishing a fully operational embassy in China while firmly asserting that Beijing should not expect any political concessions from Lithuania. This statement signals Vilnius’s intention to maintain established relations with Taiwan as they currently stand.
The government’s program includes a commitment to enhancing economic and cultural ties with Taiwan while promoting unity within the EU and transatlantic partners in shaping relations with China. While these priorities for the next four years are promising, they risk becoming mere aspirations locked in a standstill mode if the lessons from Lithuania’s previous engagement with Taiwan are not thoroughly analyzed and integrated into future collaborations—not only with Taiwan, but also with other smaller powers in the Indo-Pacific region.
Image: Lithuanian Parliament Speaker Viktorija Čmilytė-Nielsen offering a toast at a press event at the Legislative Yuan during a visit to Taiwan (October 23, 2023). (Image source: ROC Legislative Yuan)
Lessons from Lithuania’s Experience with Taiwan:
1. Informed patience
The strengthened economic ties with Taiwan have created a sense of impatience among Lithuanian citizens, business decision-makers, and certain government officials, many of whom were anticipating immediate results. For example, Asta Skaisgirytė, the chief foreign policy adviser to President Gitanas Nausėda, has expressed disappointment regarding Taiwanese investments, highlighting that the significant amounts promised by Taiwan have not materialized as rapidly or extensively as Lithuania had anticipated. This sentiment of frustration has been echoed by Lithuanian businesses, as well. Kęstutis Černeckas, a member of the Vilnius Chamber of Commerce, Industry, and Crafts, noted that exports to Taiwan experienced only a marginal increase in 2023: rising by just USD $1.6 million in the first quarter compared to the same period in 2022.
These criticisms provide some valuable lessons for the European governments. It is crucial to acknowledge that managing economic transitions can take decades to yield tangible benefits—and patience is particularly important when dealing with Asian cultures such as that of Taiwan, where interpersonal relationships are foundational and require time and trust to develop. Paulius Lukauskas, head of the Lithuanian Trade Representative Office in Taipei, has echoed this sentiment, emphasizing that while he recognizes the immense potential for Lithuania to strengthen ties with Taiwan, the desired outcomes will not emerge overnight. Thus, patience must serve as the guiding principle during this transitional period.
However, patience simultaneously requires concerted political efforts. Governments must skillfully manage public expectations and avoid making grandiose promises about the potential outcomes of enhanced economic ties. To achieve this, they should accurately assess the strengths and weaknesses inherent in both sides. Lukauskas noted that Lithuania and Taiwan, as small powers, face limitations—Lithuania has limited export capabilities, while Taiwan represents a relatively modest consumer market. Nevertheless, he pointed out that their strengths lie in technological cooperation, particularly in projects related to semiconductors and lasers.
Therefore, by clearly articulating strengths and weaknesses, governments can provide citizens and other stakeholders with a realistic perspective on the timeline and nature of progress, ultimately cultivating an informed patience. Without it, citizens and stakeholders may place undue pressure on their governments to deliver immediate results, while opposition leaders might exploit perceptions of minimal progress by promising more favorable outcomes.
2. Steadfast perseverance
Although Taiwanese investments have not materialized as quickly or extensively as Lithuania had hoped, and despite facing internal pressures, Lithuania has been committed to safeguarding and enhancing its established ties with Taiwan, including maintaining its representative office and retaining its official name. This commitment underscores the importance of perseverance, particularly amidst Beijing’s increased and concerted efforts to undermine Taiwanese confidence through disinformation campaigns disseminated by Taiwanese media outlets with pro-Beijing affiliations.
A notable illustration of this is the China Times, a subsidiary of the Want Want China Times Group, which produces content that favors Beijing while suppressing critical coverage. Following the government elections in Lithuania in late 2024, several articles appeared in the China Times suggesting that Lithuania was dissatisfied with Taiwan’s progress in fulfilling its investment commitments. One of the articles lamented a perceived gap between the “Taiwan price” and the expected “Taiwan value,” insinuating that Lithuania might be the first to distance itself from Taiwan. Additionally, the piece speculated that the return of Trump to office—with a focus on economic pragmatism, combined with the significant economic distress Europe is experiencing due to the unfolding consequences of “Biden’s Russia-Ukraine conflict”—could prompt Lithuania to adopt a “price-negate” stance toward Taiwan. Overall, these articles paint a potentially precarious picture for Taiwan in its international relations, suggesting that the United States and European nations, including Lithuania, may increasingly prioritize economic considerations over values in the context of the ongoing war in Ukraine.
Such messaging in media outlets accessible to Taiwanese citizens significantly amplifies Beijing’s cognitive warfare against Taiwan. It belittles and discredits Taiwan’s partners and fosters a narrative that instills doubt and mistrust—suggesting that Taiwan’s partners are unreliable, and merely exploiting Taiwan for their own interests. To counter such disinformation and to showcase perseverance, the European governments could intensify cooperation with Taiwanese state institutions and non-governmental organizations (NGOs) in the areas of strategic communication and counter-disinformation.
A notable instance of such cooperation is the recent visit by a Lithuanian delegation specializing in combating foreign information manipulation and interference, which took place earlier this year. This visit aimed to fortify Taiwanese institutions and NGOs, equipping them to better withstand disinformation and assisting in the development of a counter-disinformation framework inspired by the Lithuanian model. Although Taiwan currently lacks a systematic approach to countering disinformation, a process that may take years to establish, visits like that of the Lithuanian delegation exemplify the perseverance necessary to bolster confidence among Taiwanese citizens.
3. Mutual status building
As small powers, Lithuania and Taiwan share a common interest in overcoming the limitations associated with their size and enhancing their influence in international relations (IR). One effective strategy for achieving this is through status-seeking, which entails actions aimed at maintaining or improving one’s standing in the global arena. Viewed in this context, the cooperation between Lithuania and Taiwan serves as a significant source of mutual status enhancement. This often overlooked lesson offers valuable insights for smaller powers seeking to mitigate their size-related weaknesses and amplify their international standing.
While Lithuania excels in laser manufacturing, Taiwan is a leader in semiconductor production. Through technological collaboration in these fields, both countries have been increasing their competitiveness in global markets. This partnership has indeed enabled them to shift their status from being perceived as “small” to being recognized as “smart” players capable of making significant contributions to the international community.
At the same time, Lithuania and Taiwan have defied the conventional stereotype that small powers are helpless pawns in global politics with little agency. Instead, they demonstrate that they are deliberate agents capable of leveraging their power and resources to effect change. Furthermore, their ability to exercise agency challenges China’s dismissive attitude towards small states, countering the notion that they are merely instruments in a larger US plot against China.
Overall, the partnership between Lithuania and Taiwan underscores how smaller powers can collaboratively elevate their standing in the international realm. By embracing their roles as capable agents in their respective areas of expertise, they successfully redefine traditional narratives surrounding small powers and establish themselves as significant contributors to global affairs.
4. Proactive diversification
The final lesson emphasizes the importance of proactively exploring alternative markets and investment sources beyond Taiwan. Lukauskas cautioned that Lithuania should not rely exclusively on Taiwan for success in high-tech development—particularly in sectors like semiconductors—advising against the idea of “putting all the eggs in the Taiwanese basket.” In a similar context, Joseph Wu (吳釗燮), Taiwan’s former foreign minister, aimed to manage Lithuania’s expectations regarding semiconductors by asserting that it is unrealistic for a single European country to serve as the focal point of the entire semiconductor supply chain.
These statements underscore the vastness of supply chains—including the supply chain for semiconductors, which requires contributions from multiple countries and regions to operate effectively. Consequently, European governments should prioritize diversified approaches and collaborate with various nations rather than expecting one source to fulfill all roles within the supply chain.
More Reliance on Partnerships
What should the EU member states make of this package of lessons from Lithuania’s engagement with Taiwan? The straightforward answer is more reliance on partnerships, as protectionist measures from the US intensify and China remains entrenched in its export-led industrial model. The increase in tariffs by US President Donald Trump will further redirect a portion of Chinese exports towards the European Union, posing a severe risk to European industries. In light of these challenges, the European Union must take decisive action to protect its economic security and competitiveness.
On the defensive side, the European Union needs to implement and enhance the existing trade defense mechanisms to counter the influx of Chinese imports. On the offensive front, it is essential for the European Union to prioritize the development of robust partnerships beyond its borders (and beyond the United States), particularly with allies and partners in the Indo-Pacific region. Lessons from Lithuania’s engagement with Taiwan can serve as a lighthouse for the EU member states, offering a framework for establishing sustainable and lasting relationships characterized by informed patience, steadfast perseverance, mutual status building, and proactive diversification.
While individual European governments may opt to adopt or adapt these lessons to align with their specific strategies and preferences, the overarching goal is clear: more reliance on partnerships is crucial for the EU’s economic security and competitiveness as it navigates the rising tide of protectionism from the United States and China’s structural economic slowdown.
The main point: As the European Union braces itself to protect against rising protectionism from the United States and escalating trade tensions with China, Lithuania’s experience in its engagement with Taiwan provides valuable lessons. Informed patience, steadfast perseverance, mutual status building, and proactive diversification can guide the European Union in establishing strong and sustainable partnerships in the Indo-Pacific, ultimately enhancing its economic security and competitiveness.
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