His government later walked back that comment, saying continued relations would not hinge on extra investments. Similarly, in an interview with the Financial Times in September, Paraguay’s President Abdo called for Taiwan to invest $1bn to remain allies. ![]() Diplomats at the Taiwan Embassy in Tegucigalpa, Honduras, were given 30 days to leave the premises after the Latin American country severed ties with the island Honduras’s Foreign Minister Eduardo Enrique Reina ultimately called the shift in relations to China a question of “ pragmatism, not ideology” in the face of economic hardships. In the lead-up to severing ties, Honduras denied media reports that it had demanded $2.5bn in aid from Taiwan, saying instead that it had asked the island for help refinancing its debt. Long and Urdinez estimated that, on average, Latin American and Caribbean countries with diplomatic ties to China enjoyed investment, aid and loans equal in value to about 1 percent of their entire gross domestic product.Īnd according to the China Global Investment Tracker, Chinese state-owned enterprises funded $11.3bn worth of projects in South America.Įconomics were ultimately a deciding factor in Honduras’s relations with Taiwan, too. In their 2021 study, Long and Urdinez found that Taiwan invested an average of $4m a year in Paraguay between 20, and provided the country with an average of $14.8m in aid.īut those numbers were dwarfed by the economic boost China offered to other countries in the region, as South America’s top trading partner. Political scientists Tom Long and Francisco Urdinez have called it the “Taiwan cost” - the loss of economic opportunity from China. China has offered no aid, investment or finance to Paraguay as a result of its ties to Taiwan. Maintaining relations with Taiwan, however, has come at a price. Taiwan President Tsai Ing-wen greets Paraguayan ambassador Julio Cesar Arriola Ramirez during a 2019 visit to New York City Taipei has even established a prestigious engineering university in Asunción. Taiwan has invested millions of dollars into Paraguay for projects like high-voltage transmission systems and fish production. “Paraguay has always been a faithful ally that has not left alone on the difficult path that seeks to break the unjust isolation that Communist China imposes on us,” said José Chih-Cheng Han, the Taiwanese ambassador in Asunción, in a statement provided to Al Jazeera.īut the Paraguayan-Taiwanese relationship is also predicated on economic interests. ![]() Since then, support for Taiwan and opposition to “Communist China” have been a staple of Paraguayan foreign policy. Paraguay and Taiwan first formalised their diplomatic relationship in 1957. “Santiago Peña is currently the favourite candidate, but the election is still open and Efraín Alegre could win,” Paraguayan sociologist Camilo Soares told Al Jazeera. Such a decision would result in Taiwan losing its last formal diplomatic ally in South America, ending one of the island’s most enduring bilateral relationships. Taiwan President Tsai Ing-wen, right, meets visiting Paraguayan President Mario Abdo Benítez in Taipei on February 16 While Peña has pledged to maintain relations with Taiwan, Alegre has stated that he will break ties with Taiwan if elected and recognise the People’s Republic of China instead. Efraín Alegre of the more centrist Authentic Radical Liberal Party (PLRA) is also a frontrunner, and he has posed a serious threat to the Colorado’s Party longstanding dominance in the country. One is Santiago Peña from the conservative Colorado Party, which led the country for much of the 20th century and has continued to be a prominent political force, including under current President Mario Abdo Benítez.īut this year, the party’s reign might come to an end. Two candidates are currently leading the race. And on April 30, that number risks being reduced to 12 as Paraguayans head to the polls to elect a new president. ![]() Taiwan is now left with a mere 13 formal diplomatic allies, mostly in Latin America and the Caribbean. “Taiwan is an inseparable part of Chinese territory,” the Honduras foreign ministry affirmed on March 26, echoing Beijing’s “One China” policy, which refutes any notion of the island’s independence. Honduras announced that, after decades of having diplomatic relations with Taiwan, its government would switch to recognising the People’s Republic of China as the “only legitimate government that represents all of China”. On March 25, Taiwan’s foreign diplomacy was dealt a devastating blow.
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