Why Taiwan is losing longstanding Latin American allies to China

Honduran President Xiomara Castro’s decision to seek diplomatic relations with Beijing, a switch from its longstanding ties to Taipei, comes at a time other countries in Latin America and the Caribbean are finding it difficult to resist the economic pull of China.

China demands that countries with which it has diplomatic relations forego official ties with Taiwan, an island that it claims as its territory. The shift by Honduras would leave Taipei recognized by just 13 countries: Of those that remain, six are in Latin America and the Caribbean.

Several countries in Latin America and the Caribbean have maintained diplomatic ties with Taiwan for more than six decades.

They see how they “rank higher on the foreign policy hierarchy for Taiwan than they would for China,” note Ryan Berg and Wazim Mowla in The Diplomat. Taiwan, for instance, will often provide assistance after a natural disaster or an economic shock, a matter of great significance in the world’s second most disaster-prone region.

A second reason for the regional support that Taipei commands in Latin America and the Caribbean is that most of its allies there are small economies.

Guatemala, which has the the biggest economy of any of the countries that recognize Taiwan, has a GDP similar to Delaware’s. This meanings that financial interventions that would be insignificant to larger countries in the region are essential for Taipei’s allies.

But despite the apparent benefits of keeping close ties to Taiwan, several nations — especially small, commodity-exporting economies — are finding it hard to resist the economic opportunities that opening relations to China may offer.

As early as 2020 Alexander Tah-ray Yui, then head of Taiwan’s Latin American and Caribbean Affairs department and now the vice minister of foreign affairs, warned that China “makes empty promises when they try to conquer or take our allies away.”

Paraguay’s diplomatic ties to Taiwan will be tested in next month’s presidential election.

Efraín Alegre, the opposition candidate, has said he would cut diplomatic relations with the self-ruling island were he to win.

“Paraguay must have relations with China,” Alegre said, “our interests in livestock and grain sectors are currently suffering a major loss.”

Paraguay’s main exports are soybeans and beef, of which China is the world’s biggest importer.

The incumbent party holds a 10% lead according to a poll published last week in La Nación.