Lithuania's offences included opening a Taiwan Representative Office, a de facto embassy, that actually uses the word "Taiwan" rather than the name of its capital city, Taipei. It is the first EU member to take that step. It also withdrew from the so-called "17+1" group, a forum of eastern and central European countries that engage with China.
In retaliation, the CCP regime effectively banned Lithuanian goods from entering China. It also applied pressure to other European nations, especially Germany, to ban the inclusion of Lithuanian made components in any goods destined for China.
The EU moved to support Lithuania by filing a complaint to the World Trade Organization, which Australia has just decided to join, which is likely to drag on for years. A more effective step would be to kill off the EU-China investment deal, agreed to but yet to be ratified.
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Then in November, Lithuania became the first country in Europe to allow self-ruled Taiwan to open a de facto embassy under the name "Taiwan." Other such offices in Europe and the United States use the name Taipei, Taiwan's capital, to avoid references that would imply the island's independence from China. Taiwan's Foreign Ministry said the opening of the Taiwanese Representative Office in Vilnius would "charter a new and promising course for bilateral relations between Taiwan and Lithuania."
The move enraged Beijing, which saw it as an affront to its "One China" principle that insists Taiwan is part of China, rather than an independent sovereign territory, despite the two sides having been governed separately for over seven decades after a civil war. As a rule, those who want a relationship with China must recognize the policy diplomatically.
Taiwan reacted by buying up Lithuanian produce that was destined for China -- including 20,400 bottles of rum -- and pledging to invest hundreds of millions of dollars in Lithuanian industry to support the country in the face of Chinese pressure.
The spat has pulled in the European Union, which is backing member state Lithuania. Brussels sees Beijing's treatment of Lithuania as a threat to other EU nations, many of whom have deeper economic links with China and would like to deepen them further. On Thursday, the EU launched a case against China at the World Trade Organization, accusing Beijing of "discriminatory trade practices against Lithuania, which are also hitting other exports from the EU's Single Market.