- China's Ambassador Lu Shaye questioned the independence of ex-Soviet states, undermining Xi Jinping's efforts to cast China as a neutral party to help end the war in Ukraine.
- Estonia and Latvia summoned Chinese diplomats to explain Lu's comments, and Lithuania's Foreign Minister cited them as a reason the Baltic states don't trust China to broker peace in Ukraine.
- The incident reveals tensions in Chinese foreign policy, as they try to present an image of being both open and forceful.
- Investors are concerned about geopolitical risks, and the MSCI China Index lost as much as 2% on Tuesday.
- The incident is unlikely to hurt China more broadly among the so-called Global South, and may blow over quickly in some smaller nations in Europe.
Xi’s Charm Offensive Falters After China Envoy Angers Europe
Xi Jinping had been on a winning streak of late, successfully rebuffing US attempts to portray China as a threat to the global order. Then an envoy in France instantly revived all those fears.
