China is pressuring German vehicle parts giant Continental AG to stop using components made in Lithuania, two people familiar with the matter told Reuters, amid a dispute between Beijing and the Baltic state over Taipei setting up a representative office bearing the name “Taiwan” in Vilnius.
The targeting of Continental is an example of how the China-Lithuania diplomatic spat is spilling over into business in an era of global supply chains and affecting Germany’s vehicle industry, a lucrative pillar of Europe’s biggest economy.
The Chinese government last month downgraded diplomatic ties with Lithuania after the opening of the Taiwanese Representative Office in Lithuania.
Photo: AFP
Lithuania’s ruling coalition last year also agreed to support what it described as “those fighting for freedom” in Taiwan.
Continental, one of the world’s largest vehicle parts makers, has production facilities in Lithuania, making electronic parts such as controllers for vehicle doors and seats, and exports to clients globally including China.
German industry sources said that the pressure was not only being felt by Continental, but up to a dozen companies, mainly from the automotive and agricultural sectors, they said.
Continental, which supplies all of Germany’s big automakers, declined to comment on whether it had been asked by Beijing to cut links with Lithuania.
The Chinese Ministry of Foreign Affairs denied that Beijing had pressured multinational companies not to use Lithuanian-produced parts, but said that Chinese companies no longer trusted Lithuania.
“The practice of ‘one China, one Taiwan’ grossly interferes in China’s internal affairs and seriously violates China’s core interests,” a ministry spokesperson added.
“I heard that many Chinese companies no longer regard Lithuania as a trustworthy partner,” the spokesperson said. “Lithuania has to look at itself for the reason why Lithuanian companies are facing difficulties in trade and economic cooperation in China.”
Beijing has pressured countries to downgrade or sever their relations with Taiwan.
Earlier this month, a senior official and an industry body said that China had told multinationals to sever ties with Lithuania or face being shut out of the Chinese market.
Lithuania’s direct trade with China is modest, but its export-based economy is home to hundreds of firms that make products such as furniture, lasers, food and clothing for multinationals that sell to China.
The Lithuanian Ministry of Foreign Affairs said: “Companies operating in Lithuania have successfully integrated themselves into international supply chains, so China’s economic pressure measures may cause various disruptions to companies operating in Lithuania.”
“We closely monitor, analyze and evaluate each such case, including among these German companies,” the ministry said, adding that it was “looking for long-term sustainable solutions and ways to resume trade flows with China.”
MULTIFACETED: A task force has analyzed possible scenarios and created responses to assist domestic industries in dealing with US tariffs, the economics minister said The Executive Yuan is tomorrow to announce countermeasures to US President Donald Trump’s planned reciprocal tariffs, although the details of the plan would not be made public until Monday next week, Minister of Economic Affairs J.W. Kuo (郭智輝) said yesterday. The Cabinet established an economic and trade task force in November last year to deal with US trade and tariff related issues, Kuo told reporters outside the legislature in Taipei. The task force has been analyzing and evaluating all kinds of scenarios to identify suitable responses and determine how best to assist domestic industries in managing the effects of Trump’s tariffs, he
TIGHT-LIPPED: UMC said it had no merger plans at the moment, after Nikkei Asia reported that the firm and GlobalFoundries were considering restarting merger talks United Microelectronics Corp (UMC, 聯電), the world’s No. 4 contract chipmaker, yesterday launched a new US$5 billion 12-inch chip factory in Singapore as part of its latest effort to diversify its manufacturing footprint amid growing geopolitical risks. The new factory, adjacent to UMC’s existing Singapore fab in the Pasir Res Wafer Fab Park, is scheduled to enter volume production next year, utilizing mature 22-nanometer and 28-nanometer process technologies, UMC said in a statement. The company plans to invest US$5 billion during the first phase of the new fab, which would have an installed capacity of 30,000 12-inch wafers per month, it said. The
Taiwan’s official purchasing managers’ index (PMI) last month rose 0.2 percentage points to 54.2, in a second consecutive month of expansion, thanks to front-loading demand intended to avoid potential US tariff hikes, the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday. While short-term demand appeared robust, uncertainties rose due to US President Donald Trump’s unpredictable trade policy, CIER president Lien Hsien-ming (連賢明) told a news conference in Taipei. Taiwan’s economy this year would be characterized by high-level fluctuations and the volatility would be wilder than most expect, Lien said Demand for electronics, particularly semiconductors, continues to benefit from US technology giants’ effort
‘SWASTICAR’: Tesla CEO Elon Musk’s close association with Donald Trump has prompted opponents to brand him a ‘Nazi’ and resulted in a dramatic drop in sales Demonstrators descended on Tesla Inc dealerships across the US, and in Europe and Canada on Saturday to protest company chief Elon Musk, who has amassed extraordinary power as a top adviser to US President Donald Trump. Waving signs with messages such as “Musk is stealing our money” and “Reclaim our country,” the protests largely took place peacefully following fiery episodes of vandalism on Tesla vehicles, dealerships and other facilities in recent weeks that US officials have denounced as terrorism. Hundreds rallied on Saturday outside the Tesla dealership in Manhattan. Some blasted Musk, the world’s richest man, while others demanded the shuttering of his
RSS