VILNIUS – Lithuanian Economy and Innovation Minister Ausrine Armonaite admitted on Monday that "there is concern" about foreign investors' plans due to China's actions, adding that the situation is expected to be de-escalated.
"We have no further information about companies changing their plans. There is concern, and, of course, everybody hopes that the situation will de-escalate and will be resolved, which is what we expect as well," the minister said during an event co-hosted by her ministry and Invest Lithuania, the government's foreign investment promotion agency.
"Recent developments have not contributed to the attractiveness of the investment environment," Armonaite said, referring to China's unofficial sanctions imposed on Lithuanian businesses in the wake of the opening a Taiwanese representative office in Vilnius last autumn.
"But we hope that this will be an incentive for Lithuania to make decisions, for example, on how to attract talent and some other decisions on the business environment," she added.
The media reported in December that China was pressuring Germany's car parts giant Continental to stop using components made in its Lithuanian plant.
Elijus Civilis, head of Invest Lithuania, has said recently said that 40 percent of surveyed Lithuanian companies are experiencing difficulties due to China's sanctions.
He admitted that foreign investors prefer politically stable countries, meaning that Lithuania may lose some of its competitive edge to neighboring countries.
Lithuania has angered China by allowing Taiwan to open its representative office in Vilnius under the name "Taiwanese" instead of "Taipei".
In retaliation, China last autumn halted freight trains to Lithuania, stopped issuing food export permits, cut credit limits and raised prices for Lithuanian companies, and removed Lithuania from its customs systems, meaning that Lithuanian goods cannot clear customs.