China has threatened commerce with some international locations after feuds. They’re calling ‘the agency’ for assist

WASHINGTON (AP) — Enterprise is sweet at “the agency.”

The eight-person workforce on the State Division is main Washington’s efforts to ease the financial blowback for international locations focused by China.

It emerged within the scramble to assist Lithuania during a spat with China over Taiwan two years in the past. Right now, “the agency” helps rising numbers of countries address what diplomats name financial coercion from Beijing.

International locations “knock on the door, they name,” Undersecretary of State Jose Fernandez instructed The Related Press in a current interview. “We run a consulting agency that doesn’t need to promote for shoppers, as they arrive.”

Led by State Division senior adviser Melanie Hart, the group critiques vulnerabilities and develops responses for international locations which might be minimize off or worry shedding commerce with world powerhouse China. Because the group’s launch with Lithuania, greater than a dozen international locations have approached the Biden administration for help, Fernandez stated.

The hassle comes as Washington is stepping up its marketing campaign to push back at China’s global influence and tensions develop between the rivals.

The Chinese language Embassy in Washington took challenge with the notion that Beijing is utilizing financial stress on different international locations, calling it “fully unfounded.” The US, it stated, was the one bullying China economically by abusing export controls, treating Chinese language firms unfairly and labeling Beijing as a perpetrator of financial coercion.

Fernandez stated that may be a tactic China “is utilizing again and again. They imagine that intimidation works. That’s why we acquired into the act. The time had come to cease this factor.”

For instance, when a Norwegian committee in 2010 awarded the Nobel Peace Prize to a Chinese language dissident, Beijing stopped buying salmon from the Nordic nation. Two years later, China rejected banana imports from the Philippines over a territorial dispute within the South China Sea. In 2020, Beijing responded to Australia’s name for an investigation into the origin of the COVID-19 pandemic by elevating tariffs on Australian barley and wines.

Then got here Lithuania. In late 2021 and early 2022, Lithuanian companies noticed their cargo shipments to and from China stranded, they usually had been warned by main European companies that Lithuanian-made auto elements can be barred from merchandise for the Chinese language market.

That got here after Lithuania allowed Taiwan’s de-facto embassy in Vilnius to bear the identify Taiwan, as a substitute of Taipei — Taiwan’s capital metropolis — as most well-liked by Beijing. China considers the self-governed island to be a part of Chinese language territory and protested the usage of Taiwan.

As a substitute of caving in, the northern European nation requested for assist. The U.S. and its allies stepped up.

American diplomats sought new markets for Lithuanian items. The Export-Import Financial institution in Washington offered Vilnius with $600 million in export credit score, and the Pentagon signed a procurement settlement with the nation.

And “the agency” saved at it. The State Division works as the primary line of response and might coordinate with different U.S. businesses to achieve “each instrument that the U.S. authorities has,” in accordance with a division official who requested to not be named to debate particulars of the workforce.

Whereas it takes years to reorient world provide chains to scale back reliance on international locations similar to China, the workforce tries to supply a faster approach to ease a disaster, the official stated, evaluating the workforce to ambulance companies that “assist you to get previous that scary emergency time.”

For instance, the U.S. would possibly attempt to work with companions to assist a rustic rapidly divert agricultural merchandise to new markets, construct extra chilly storage so merchandise can attain farther markets or enhance product high quality to achieve entry into extra markets, the official stated.

The help is confidential, the official stated, declining to debate the instruments on the workforce’s disposal or identify the international locations which have sought assist.

Shay Wester, director of Asian financial affairs on the Asia Society Coverage Institute, stated it was “a big and much-needed initiative.”

“China’s rising use of financial coercion to stress international locations over political disputes is a big problem that requires a concerted response,” stated Wester, who co-authored an April report on the problem.

The responses from different international locations present that demand is excessive for this sort of help, Wester stated.

This month, Lithuania hosted a convention on resisting financial stress, and Overseas Minister Gabrielius Landsbergis stated the intention of that motion “is to crush the victims by forcing reversal and public renunciation of its insurance policies.”

Liu Pengyu, the Chinese language Embassy spokesman, stated the issue with Lithuania was “a political not an financial one. They had been attributable to Lithuania’s acts in unhealthy religion that damage China’s pursuits, not China’s stress on Lithuania.”

Fernandez, who attended the convention, applauded Lithuania for standing as much as China. “Lithuania gave us the chance to show that there have been options to the coercion,” he stated.