Taiwan faces growing pressure in Latin America as China tries to poach its diplomatic allies through vaccine diplomacy

Over the last few months, Taiwan’s diplomatic allies in Latin America have shown signs of possibly switch allegiance to Beijing as China continues to expand the reach of its “vaccine diplomacy” across the continent. Even though Taiwan successfully safeguarded its diplomatic relationship with Paraguay in April, experts think once there is a power transfer in Paraguay, the possibility could resurface again.

When countries around the world are trying to secure COVID19 vaccines for their citizens, China continues to use its vaccine as a mean for them to expand their political influence. Several of Taiwan’s diplomatic allies in Latin America became the targets of China’s aggressive campaign.

After several media outlets reported that China tried to use COVID19 vaccine to force Paraguay to severe its diplomatic ties with Taiwan last month, Financial Times reported on May 19 that Honduras hinted that they could consider establishing diplomatic ties with China if they need to gain access to the Chinese vaccine.

Carlos Alberto Madero, the chief cabinet coordinator for Honduras, said while Honduras wants to maintain its diplomatic ties with Taiwan, access to COVID19 vaccines is more important than anything else. He hinted that the situation now could definitely lead to changes in foreign policy.

“ This puts us in a very difficult situation,” Madero said. “The Honduran people start to see that China is helping its allies and we start to ask ourselves why ours are not helping us.”

The United States has announced that they plan to prioritize Latin America as the receiver of a huge batch of COVID19 vaccines that Washington plans to donate to countries around the world next month. The move is viewed as an attempt for the US to compete with China’s aggressive vaccine diplomacy campaign in Latin America.

Joanne Ou, the spokesperson of Taiwan’s Foreign Ministry, said the Honduran Foreign Ministry has reiterated its commitment to the bilateral relationship with Taiwan and the ministry condemned China’s attempt to use access to their COVID19 vaccines as a way to force countries in dire needs of vaccines to accept certain political or diplomatic conditions.

In fact, Chinese vaccine manufacturers have tried to use severing diplomatic ties with Taiwan as a condition for Paraguay to gain access to COVID19 vaccines from China. However, the Paraguayan President and Foreign Ministry have criticized China’s moves, describing it as lacking justification and harming Paraguay’s sovereignty.

On April 20, Paraguay’s President Mario Abdo Benitez issued a public statement, reiterating that negotiations for receiving COVID19 vaccines need to take place within the framework of respect for independence and diplomatic freedom.

“We have no problem buying from anywhere. Now, we are not going to accept any kind of blackmail for vaccine purchases. We ask and we are open to have direct dealings with factories in China, without any type of conditions regarding diplomatic relations,” he said.

Alexander Yui, director general of the Department of Latin American and Caribbean Affairs at Taiwan’s Foreign Ministry, said the calls on reviewing Paraguay’s diplomatic relationship with Taiwan at a time when the country faces shortage of COVID19 vaccine may be intentionally created.

“China tries to use COVID19 vaccine as a mean to take away Taiwan’s diplomatic ally, and this shows that China is praying on other countries’ vulnerability,” he said. “I think such behavior is very inhumane and nasty.”

Multiple factors affect the relationship between Taiwan and Paraguay

Even though Taiwan and Paraguay’s diplomatic relationship survived the latest round of threat from China’s vaccine diplomacy, some experts think the bilateral relationship could still change under the influence of other external factors.

Julian Tucker and Larissa Stünkel from the Institute for Security and Development Policy in Sweden, wrote in a recent report that diplomatic realignment from the Republic of China to the People’s Republic of China often goes hand in hand with a change in government. “Election periods have therefore come to be critical moments for Taipei pre-heralding a potential loss of recognition,” they wrote.

Tucker said that the specifics of the relationship between Taiwan and Paraguay are pretty much tied up with the trajectory of China. “As China changes, so too does Taiwan and the calculation that is made by countries that want to have diplomatic and economic relations with China, as increasingly political relationships with China,” he said.

“Time and again, in the specific relationship between Paraguay and Taiwan, there has been these moments where the calculation really could have transformed. The US has been a factor in brokering the relationship. Since 2016, there has been a trend that the US has made Taiwan sustaining diplomatic presence part of its approach to different bilateral partners and countries.”

Tucker pointed out that in 2019, there were calls for re-evaluating its diplomatic ties with Taiwan, as some people think that maintaining diplomatic ties with Taiwan has forced Paraguay to miss out on the positive economic values that come with cooperation with China. However, Taiwan tried to address the concern by exploring areas that both countries can initiate collaboration.

“Following the Paraguayan President’s meeting with former US President Donald Trump in December 2019, they released a joint statement, announcing a desire to deepen cooperation on regional policy and security issues, making references to cooperation between the U.S. International Development Finance Corporation (DFC) and Taiwan in developing healthcare infrastructure in Paraguay,” he said. “One of the provisions of this three-way cooperation deal was the construction of a major medical facility in Asunción, the Jerovia Mount Sinai Medical Center.”

Additionally, the US, Taiwan and Paraguay organized a three-way video conference in March to talk about potential cooperation on renewable energy development. During the meeting, high level officials and executives from Taiwan and the US discussed Paraguay’s hydroelectric energy surplus as well as potential collaboration in green hydrogen, solar energy, smart electricity distribution and storage systems, and EV component development.

“One of the issues that they touched on is generating economic prosperity and one subject of discussion is renewable energy,” Tucker said.

What does the diplomatic relationship with Taiwan mean to Paraguay?

Francisco Urdinez, an assistant professor of political science at the Pontifical Catholic University of Chile, examined the diplomatic relationship between Taiwan and Paraguay in an academic paper published last January and he said Paraguay uses its diplomatic recognition policy for status-seeking.

“Paraguay receives international status of a different nature, with tangible and intangible benefits captured by its cohesive elite, mostly linked to the Colorado Party,” Urdinez said. “These include material benefits like aid for politically favored projects, including funding the Diplomatic Academy and National Congress buildings, as well as attention through high-profile diplomatic visits and elite exchanges, and praise and recognition of Paraguay’s unique value to its longtime ally.”

Urdinez and his co-author Tom Long build an econometric model to estimate the economic opportunity cost of not recognizing China and recognizing Taiwan instead. “We estimated that the cost represented 1% of its annual GDP, close to a yearly loss of 300 million USD,” he said. “The ‘Taiwan Cost’ nowadays is much larger considering that its diplomatic status limit the possibility buying Chinese vaccines.”

Urdinez said while Paraguay received a large amount of aid from Taiwan after the coronavirus pandemic broke out, Paraguay’s congress still discussed a bill proposal related to switching diplomatic ties in 2020.

“Even though the Taipei Act passed by the US Congress aims at deterring Taiwan’s remaining diplomatic allies from severing its ties with Taiwan, China’s checkbook diplomacy is too considerable for a developing country to resist,” he said. “For the average Paraguayan citizens, the pandemic made them realize the real cost of not having diplomatic relations with the world’s second largest economy.”

“The issue has become politicized and has been debated a lot domestically. It is difficult to believe that Paraguay and Taiwan will be able to strengthen their relationship unless Taiwan offers much more aid and investment than it does today.”

Urdinez thinks that while the current government in Paraguay will not severe diplomatic ties with Taiwan, it might still occur if the next President is not from the current ruling party. Julian Tucker from the Institute for Security and Development Policy also pointed out that as the current Paraguayan president‘s term ends in 2023, it will be a very critical moment for the diplomatic relationship between Taiwan and Paraguay.

This piece was first published in Mandarin on DW’s Chinese website.