Norway has been hit with the first wave of diplomatic backlash after awarding the Nobel Peace Prize to jailed Chinese pro-democracy activist Liu Xiaobo.

China called off two high-level meetings in Beijing with Norway’s fisheries minister this week. In addition, cancellations have been pouring in for four other scheduled Sino-Norwegian meetings.

But the award could actually provide a bigger backlash for China at home because it has generated a “game-changing” dynamic for reform, according to Sharon Hom, executive director for Human Rights in China, an international nongovernmental organization based in Hong Kong and New York.

Why China sees Norway as responsible for Nobel

China is upset that the Norwegian Nobel Committee gave the award to Mr. Liu, who was sentenced in December 2009 to 11 years in prison for “inciting subversion of state power.” He was a leading author behind Charter 08, a political manifesto that calls for increased rule of law, greater respect for human rights, and an end to one-party rule in China.

“The Norwegian Nobel Committee, by giving the Peace Prize to a convicted person in China, shows no respect for the judicial system of China,” Chinese foreign ministry spokesma Ma Zhaoxu said this week, warning of damaged China-Norway relations.

IN PICTURES: Liu Xiaobo: Nobel Peace Prize recipient

Norway has tried to ease the situation by highlighting that the Norwegian Nobel Committee is independent of the Norwegian government. “We cannot [accept] that an independent committee’s decision shall lead to bilateral relations between Norway and China being affected,” Foreign Minister Jonas Gahr Støre said in a meeting today with China's ambassador.

But despite Norway's effort to make such distinctions, China has retaliated with a string of rebuffs.

“It really reflects the Chinese government’s own sense that authorities should be able to tell anybody, including independent bodies, what to do,” Ms. Hom told The Christian Science Monitor.

A delegation from China’s high court, scheduled to meet its Norwegian counterpart this week, canceled because of “other urgent obligations” and a Chinese military delegation called off its meeting in Oslo with Norway’s justice ministry at the last minute, according to Ragnhild Imerslund, assistant director general of Norway's foreign ministry.

In addition, many participants from a group representing Chinese researchers, experts, and journalists slated to study the Norwegian welfare state model have canceled next week’s visit to Oslo. An Asian study tour by 17 Norwegian state secretaries for next week has been postponed because key meetings in Beijing were also canceled.

Chinese elders call for political reform

The prize has posed a dilemma for the Chinese government. It has generated a throng of support from countries calling for Liu’s release, including the United States, United Kingdom, Germany, France, and most recently a polite suggestion from Japan’s prime minister that Liu’s release would be “desirable.”

The prize has also encouraged voices – even within the Communist Party of China – to appeal for political reform. Earlier this week, an open letter from Chinese Communist Party elders, including a former secretary to Mao Zedong, called for the Standing Committee of the National People’s Congress to end restrictions on expression in China.

The letter urged the Communist Party to abolish censorship and realize citizens’ right to freedom of speech and freedom of the press. The petition was started Oct. 1 – one week before the Nobel Peace Prize was awarded – with just 23 signatures. Since then it has expanded to nearly 500 signatures.

And on Thursday, more than 100 Chinese activists released a separate open letter asking that Liu be released from prison. Norway's foreign minister has also called for Liu’s release and for his wife’s house arrest to be lifted.

“The Nobel Peace Prize has generated a game-changing process,” says Hom. “There are voices within the party who are now going public. It is a quite interesting moment when the Norwegian government recognizes this type of reaction, that it actually reflects a political sense of vulnerability of the leadership.”

Nobel has caused diplomatic tensions before

Norway's diplomatic relations have suffered before over the Nobel Peace Prize, notably with the 1989 award to the Dalai Lama. Primary concern for the moment is over the possible effect on Norway's economic relations with its most important trading partner in Asia.

Norway and China are tentatively scheduled to hold the next round of bilateral trade talks in mid-December, shortly after the Nobel Peace Prize ceremony in Oslo on Dec. 10.

Some predict that negotiations may be postponed, but not altogether derailed. China has expressed its dissatisfaction before with other, even larger trading nations – such as Germany for receiving the Dalai Lama in 2007 – but still come back to the trading table.

“It is not a simple causal relationship,” says Hom. “China will do what is in its best strategic interests.”

IN PICTURES: Liu Xiaobo: Nobel Peace Prize recipient