(BRUSSELS) - The EU presidency on Thursday criticised Taiwan's decision to hold a referendum on seeking UN membership, saying it could inflame tensions with China.

"While recognizing the general value of referenda as democratic instruments, the EU is, nevertheless, concerned by the decision in Taiwan to proceed with the proposed referendum on joining the UN in the name of Taiwan," the European Union's presidency, currently held by Slovenia, said in a statement.

"The proposed referendum would risk increasing cross-straits tension, to the potential detriment of all concerned, including the people of Taiwan."

Taiwan, which officially calls itself the Republic of China, has decided to hold a referendum next month on joining the United Nations under the name "Taiwan".

The controversial referendum, proposed by the governing Democratic Progressive Party (DPP), will be held alongside the island's presidential elections on March 22, the Central Election Commission announced last month.

Taiwan, under its official name, lost its UN seat to the communist mainland in 1971 and is now only recognised diplomatically by around 20 countries.

The island has made several moves to formally join international organisations such as the UN under its official name, but this is the first time it has tried under the name "Taiwan".

The European Union "has a significant stake in the maintenance of cross-strait peace and stability," and adheres to the "One China" policy, the EU's Slovenian presidency stressed, adding that "the Taiwan question must be solved peacefully between the parties concerned."

"There should be no recourse to unilateral action, destabilizing initiatives or coercion by either side."

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