In August 2016, South Korea officially announced the deployment of the “THAAD” system, triggering restrictions from the Chinese Communist Party (CCP). In 2012, due to the South China Sea dispute, the CCP refused to import bananas and pineapples from the Philippines. In 2020, Australia requested an investigation into the origins of the COVID-19 pandemic, leading to increased tariffs on Australian barley and wine by the CCP.
Next came Lithuania. At the end of 2021 and the beginning of 2022, Lithuanian businesses found their shipments to and from China stranded, with major European companies pressured by the CCP warning them that Lithuanian-manufactured auto parts would be banned from entering the Chinese market. Previously, Lithuania allowed Taiwan to name its office in Vilnius as Taiwan instead of Taipei, angering the CCP.
Lithuania did not yield but sought help, with the United States and its allies extending a helping hand. The US State Department’s eight-member group, named “the firm”, emerged to assist other countries in dealing with economic coercion from the CCP. US officials likened this group to an “ambulance service”.
Deputy Secretary of State Jose Fernandez, in a recent interview with the Associated Press, mentioned that countries have been seeking help. “We’re running a consultancy firm, no need to advertise, clients will come to us on their own.”
Led by State Department Senior Advisor Melanie Hart, the group aims to help other countries combat economic coercion from the CCP. Fernandez stated that since its establishment due to the Lithuania situation, over ten countries have sought assistance from the Biden administration.
Though the Chinese embassy in the US consistently denies the allegations, Fernandez stated that this is a strategy repeatedly used by the CCP; they believe that intimidation is effective. “That’s why we’re taking action. It’s time to stop this.”
Hart has been encouraging US allies to collectively address CCP’s “economic coercion”. Last November, Hart participated in a report meeting held by a US think tank on “Investigating China’s (CCP) Economic Coercion: The Impact and Role of Chinese Commercial Entities”. She expressed the US’s willingness to share tactics used by China (CCP) in economic coercion, emphasizing that “America’s door is always open, and the US will provide assistance to allies at any time”.
On April 8th, US Ambassador to Japan Emmanuel Emmanuel stated at a discussion at the Center for Strategic and International Studies (CSIS) in Washington that the CCP continuously employs “economic coercion” to pressure various countries, including Japan and the Philippines. He views this as the most enduring and harmful tool of the CCP, using it to politically pressure other countries.
“The firm” remains steadfast. A US State Department official, who chose to remain anonymous, mentioned that the State Department is at the forefront of response measures and can coordinate with other US agencies, utilizing “all tools available to the US government”.
The official stated that while it may take several years to reconfigure global supply chains to reduce reliance on countries like China, the group is trying to offer a quicker way to mitigate the crisis, likening the eight-member group to an ambulance service to “help you through a terrible emergency”.
The official mentioned that assistance is confidential, and they refused to discuss the tools the group could use or reveal the names of countries seeking help.
Philippine Foreign Secretary Enrique Manalo stated on March 4th that the Philippines is facing serious “economic coercion” from the CCP. He highlighted that the Philippines heavily relies on trade relations with China, and thus hopes to expand economic ties with other countries, like eagerly initiating formal negotiations with the EU for a free trade agreement.
Philippine Ambassador to the US Jose Manuel Romualdez also touched on US assistance to the Philippines. He stated that Beijing is “using its economic influence to attract or isolate countries”. The US State Department is providing suggestions on potential new export markets and other support for their agricultural sector, including the deployment of cold storage facilities in the Philippines to store agricultural products that China may boycott.
Shay Wester, the Director of Asian Economic Affairs at the Asia Society Policy Institute, deemed these actions as “critical and urgently needed”.
“China (CCP) increasingly uses economic coercion to pressure various countries in political disputes, presenting a significant challenge that requires a coordinated response,” said Wester.
Wester mentioned that the responses from other countries indicate a high demand for such support.
This month, Lithuania hosted a conference on combating economic coercion, with Foreign Minister Gabrielius Landsbergis stating that the purpose of China’s actions is to force victim countries to reverse policies and publicly abandon them through coercion, in an attempt to crush them.
Fernandez, who attended the conference, praised Lithuania’s stance against the CCP. “Lithuania has given us the opportunity to demonstrate that there are other choices beyond coercion,” he said.