This summer, when China’s government threatened Edinburgh with sanctions over a friendship agreement with Taiwan’s Kaohsiung, a debate ensued within the Scottish city. Business groups protested against a formal agreement on economic terms, while a number of politicians said it would be morally wrong to bow down to pressure from Beijing.
One position was notable by its absence, though. Nobody (in public at least) questioned the actual impact of the potential sanctions.
This makes sense on one level. China’s representative in Edinburgh, Zhang Biao (張飆), directly threatened that a formal agreement would “bring about serious consequences.” And business groups did indeed have clear economic incentives not to take that risk.
However, if one takes a broader view, there may be reasons for a city like Edinburgh not to take Beijing exactly at its word when it talks about sanctions for sister cities.
Sanctions From Beijing: A Mixed Picture
In a 2022 report, the Mercator Institute for China Studies (MERICS) identified 123 attempts at imposing economic pressure on companies or sectors between February 2010 and March 2022. It found that in 21 percent of cases initial warnings were not followed up on, and where sanctions were put into effect the Chinese government was careful to only place them on sectors where it could afford to incur the costs of replacement goods and services.
“They love to send out threats, but they are not stupid,” Hung-bin Ding (丁弘彬), co-founder of Taiwan Sister Cities, said in a video call to Domino Theory.
Ding, who had first-hand experience of pressure from China when he was involved in the city of Rockville, Maryland twinned with the Taiwanese city of Yilan, said there are three layers of potential impact from sanctions, and each comes with inbuilt limitations on the Chinese side.
Individual Chinese citizens wanting to go to places as students or tourists would not be easily changed by government policy.
Cultural and educational exchanges which are directly controlled by the Chinese government can be reduced if the government is unhappy with a decision, but this means giving up influence “so they will bring it back over time.”
And then there are business decisions that can be affected by the government but are subject to cost considerations — lost business and lost influence.
“They can reduce the number of flights arbitrarily [for example]. They can redirect their state-owned enterprises from Edinburgh to somewhere else,” Ding said. However, “They fly to Edinburgh because of their needs for people to fly to Edinburgh. [If you cut the flights,] you are basically opening up opportunities for British airlines to take advantage of their route.”
In Ding’s view, the most likely way a city could definitively miss out on investment because of its politics would be if “two cities offer similar packages, and there’s a tiebreaker.” But this is a quite specific circumstance.
The Case of Prague
Adam Kalivoda, a project coordinator at the Central European Institute of Asian Studies, offered an overlapping summary when asked about the experience of Prague. The Czech city had relations with Shanghai broken off in 2020 when it twinned with Taiwan’s capital, Taipei, but the sanctions coming from Beijing appeared limited.
“Most of the consequences, as far as I know, were connected to the initial breaking of ties and ended up in the cancellation of a few planned cultural events at the time, or shortly after,” Kalivoda said by email, although he noted this may have been because the relations with Shanghai were only a couple of years old. “So there may be a certain ‘opportunity cost’, of what may have been established were they to develop properly.”
Interestingly, regarding flights, the opposite effect to the one that might be expected was seen.
“Prague seemed to not only not lose out, but despite the sister-city relation cancellation in the past it managed to re-establish direct flights between Prague and Beijing recently (I believe they are operated by Hainan Airlines),” Kalivoda said, “but I think that is also due to the wider advantage that Chinese airlines have in Europe-Asia connections as they can fly through Russian airspace.”
The Nightmare Scenario
To be sure, this is not to suggest that “serious consequences” never arrive, although you may have to look beyond sister city arrangements to find them. The MERICS report cited above found restrictions on tourism were adopted in 20 percent of cases it studied and, looking at the state level, a Center for Strategic and International Studies report from last year detailed eight examples of actually existing Chinese sanctions against countries.
However, importantly, even in each of those cases, mitigation efforts were found to have compensatory impacts and sanctions proved temporary.
This was true even in the infamous 2021 case of Lithuania being sanctioned for opening the “Taiwanese Representative Office in Lithuania.” The Lithuanian National Bank estimated import bans would decrease its GDP growth by 0.1 to 0.5 percent in 2022 and between 0.3 to 1.3 percent in 2023. However, Taiwan’s government responded with a billion dollar fund to help fund joint projects, and trade with China has steadily returned as normalizing relations with Beijing has become a focus point for the upcoming parliamentary elections in October, according to Matej Hulicka, an intern at China Observers in Central and Eastern Europe.
That experience suggests two things. Firstly, Taiwan and others will back those who receive sanctions — even if many still argue it is insufficient. But secondly, Beijing is flexible enough to know that it has to offer carrots as well as sticks. Which means “consequences” tend not to be permanent.
Conclusions for Sister Cities
All of those points make a case that, even if Edinburgh had faced sanctions, they would not have been a zero-sum equation. And this chimes with a final — slightly provocative — point Hung-bin Ding makes.
Many Chinese sister-city relationships Ding has seen lying dormant suddenly “wake up” when a proposal from a Taiwanese sister city arrives — referring to restarting cultural exchanges or trade. “It’s almost like a proposal from any Taiwanese group ‘wakes them up.’ So, if anything, those cities should welcome a proposal from us. Instead of having one dormant sister city, then you will have two very active sister cities,” Ding said.
In other words, not only are the potential losses overemphasized and oversimplified, there are even, potentially, gains to be made, too. At the very least, this counter view is worth considering before cities become overly concerned about being caught up in political competition between China and Taiwan.
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