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Latin America increasingly turning to China at Taiwan’s expense

Paraguay’s opposition candidate is pushing for closer relations with Beijing in a presidential election that could have high stakes for the autonomous island.

Bala Chambers

Ahead of her two-nation visit to Latin America earlier this month, Taiwan’s leader Tsai Ing-Wen made a case for strengthening diplomatic ties with Guatemala and Belize. “External pressure will not obstruct our resolution to go on the world stage. We will be calm, self-confident, we will not submit but also not provoke.”

However, China considers Taiwan as part of its territory while Taiwan sees itself as a sovereign state.

Only 13 countries officially recognise Taiwan and the number is dwindling.

In March, another Latin American nation Honduras severed diplomatic ties with Taiwan amid reports of potential Chinese investment in the country.

Tsai’s visit to Guatemala and Belize and her subsequent trip to the US have drawn a sharp rebuke from Beijing which has not ruled out invading Taiwan the island by military force. China said this week’s three-day military drill that included “encircling” Taiwan should serve as a “serious warning” to the self-governing island and other foreign powers that do not subscribe to the one-China principle.

Lorenzo Maggiorelli, Professor of International Relations at the Pontifical Javeriana University in Bogota, notes during Tsai’s tenure, Taiwan lost “recognition of five Latin American countries during her mandate (Panama, Dominican Republic, El Salvador, Nicaragua, and Honduras)”.

He explains that Taiwan’s “New Southbound Policy” under Tsai has focused more on expanding Taiwanese ties in the Asia-Pacific region than with Latin America in recent years, although she has tried to increase its cooperation with Latin American partners, “with mixed success.”

Maggiorelli tells TRT World that Tsai’s visit to Latin America “was an important message to reaffirm Taiwan’s bilateral ties with its remaining diplomatic allies”.

Alignments and realignments

Since the founding of the People’s Republic of China (PRC) in 1949, Beijing has faced challenges in deeping ties with Latin America.

Maggiorelli argues it was “due to the region’s general alignment with US foreign policy and to a widespread anti-communist sentiment in most countries”.

As such, many Latin American countries held diplomatic ties with Taiwan until the US-China rapprochement in the late ’60s and Beijing’s admission into the UN in 1971.

“Even then, most Latin American countries waited for Washington to fully recognise Beijing (in 1979) to switch their diplomatic allegiance and fully recognise the PRC,” Maggiorelli explains.

After international condemnation of the Tiananmen Square massacre in 1989, several countries switched back to recognise Taiwan as it advanced its democratisation process.

“It was only with China’s economic rise following its accession to the WTO (World Trade Organisation) in 2001 that the economic importance of holding diplomatic relations with Beijing became more important than any ideological consideration,” argues Maggiorelli.

This process helped to drive China’s subsequent engagement with Latin America.

Amid China’s growing footprint in Latin America, the world’s second-largest economy has invested over $130 billion in the region from 2005-2020, as Taiwan continued to vie with Beijing for allies.

“Taipei has tried and still tries to retain its diplomatic allies in the region through foreign aid. Nevertheless, China’s increased trade and investment relevance in the region made Taiwanese aid less and less important compared to the opportunities offered by Beijing,” explains Maggiorelli.

Taiwan’s “chequebook diplomacy” – the policy of using economic aid and investments to bolster bilateral relations – he says was successful with less developed Caribbean and Central American nations while more developed nations like Panama pivoted towards Beijing.

However, there are differences in the methods employed by China and Taiwan.

“Taiwanese cooperation is characterised by a transfer of resources and knowledge and, as such, resembles traditional Western-style foreign aid,” Maggiorelli says.

“Beijing’s cooperation, on the contrary, reflects a win-win approach that is more typical of South-South cooperation, where there must be a mutual benefit that small Caribbean islands can not easily offer,” he adds.

Last South American ally standing

Paraguay has been an ally of Taiwan since 1957 and is the only South American nation to still hold official diplomatic relations with Taipei.

On April 30, Paraguay will hold presidential elections with potential implications for Taiwan.

According to Julieta Heduvan, a Paraguayan foreign policy analyst, the heightened tensions in the Taiwan Strait have led to a growing public show of support from the government and officials towards Taiwan.

She says recognition of Taiwan is an ever-present issue in Paraguayan politics while the elections “have intensified” the debate and visibility of it.

The opposition party candidate Efrain Alegre is pushing for closer ties with Beijing, recently saying that “Paraguay must have relations with China”.

Heduvan tells TRT World that Alegre, the Concertación presidential candidate and leader of the Liberal Party (PLRA) “has expressed a more critical stance on Paraguay's relations with Taiwan. His position is more in line with that of the agro-exporting sectors in terms of the need to evaluate the commercial possibilities offered by the relationship with China.”

“Alegre has not openly expressed his intention to definitively modify Paraguay’s guidelines towards Taiwan, although he has stated that the Taiwanese government is not doing enough to justify Paraguay's support,” she adds.

Heduvan suggests Alegre’s stance could depend on the outcome of future negotiations between both nations and potential changes implemented by Taiwan to benefit Paraguay.

In the past year, hints of Paraguay’s frustration concerning Taiwan relations have appeared.

In September 2022, Paraguay sought $1 billion from Taiwan in investment to avoid pressure to recognise China amid a push from the agri-business sector for entry into the Chinese market.

Heduvan says Taiwan has increased import quotas of Paraguayan products to satisfy “concerns” from the agricultural and livestock sectors and to “ease commercial pressures”.

However, the ruling Colorado Party’s “alignment with Taiwan remains unchanged”, she adds, with presidential candidate, Santiago Peña, favouring recognition of Taiwan.

US impact

According to Maggiorelli, Tsai’s US trip, while not unprecedented, is a “more politically relevant issue” to consider, implying “a strong will by US and Taiwan to reaffirm Taipei’s independence and thereby continue to escalate tensions with Beijing.”

In the future for Taiwan to avoid “total diplomatic isolation”, Maggiorelli suggests "some pressure" could be exerted from Washington for developing nations in the Caribbean to maintain relations with Taipei.

He also believes that Washington will not allow Taiwan to lose all of its diplomatic allies in the UN General Assembly.

“On the one hand, for Taipei to lose all official recognition won’t be a complete disaster since they maintain unofficial relations with many countries. On the other hand, it would be a severe blow to its autonomy, and it would make it very difficult to have any voice in international forums and to access any international support,” argues Maggiorelli.

“The situation would be entering into new and uncharted territory, and it would probably give more legitimacy to China’s aggressive military actions in Taiwan’s Strait, with implications for the stability and security of the whole Indo-Pacific.”

(EDITOR: 4/15/23) A previous version of this story identified one of the experts as Julieta Henduvan. The correct spelling of her last name is Heduvan.)

SOURCE: TRT World