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Caught Between Trump and China, Taiwan Takes Checkbook Diplomacy to Central America

President Tsai Ing-Wen traveled to Central America to loosen China's grip on Taiwan. But will it work?

By Robbie Gramer, a diplomacy and national security reporter at Foreign Policy.

Taiwanese President Tsai Ing-wen set off on a trip to Central America this week to shore up her country’s remaining handful of friendly states with formal diplomatic ties. It’s a checkbook offensive designed to reassure Tsai’s few formal allies abroad — and her constituents at home — that Taiwan can retain its independence from mainland China following months of increased diplomatic pressure from Beijing.

Tsai traveled to Nicaragua, Guatemala, Honduras, and El Salvador to cement Taiwan’s bilateral relations. The countries may not be geopolitical heavyweights, but they carry outsized importance for Taiwan; they are four of only 21 countries in the world that recognize Taiwan’s sovereignty from China. Most of those countries, including those Tsai visited this week, are developing countries that exchange recognition of Taiwan’s sovereignty in for lucrative business and development deals with Taipei.

Taiwan had 22 countries in its corner until December. That’s when the small African island nation of Sao Tome and Principe cut ties with Taipei in favor of Beijing after hearing China’s siren song. This marked the beginning of a new Chinese campaign to tighten the vice around Tsai.

Experts say it was retaliation against Tsai’s early December phone call with U.S. President-elect Donald Trump that broke with decades of the United States’ “One China” policy. “The Chinese have started pressuring Taiwan every way they can think of,” Robert Manning, an Asia expert at the Atlantic Council, told Foreign Policy. “Sao Tome and Principe may be the beginning of a new competition,” he said.

Tsai perhaps didn’t help matters by flying to Houston to meet Texas Gov. Greg Abbott and Sen.Ted Cruz on her way to Central America, which sparked another diplomatic rebuke from China (and a jaunt by its one aircraft carrier into the Taiwan Strait on Wednesday).

Between Beijing’s ire and Trump’s erratic stances on China, Taiwan’s few friends in Central America are now all the more important. But some Central American leaders likely know that, and may try to leverage their newfound attention for a bidding war between China and Taiwan’s checkbooks. During Tsai’s stop in Nicaragua on Tuesday, Nicaraguan President Daniel Ortega pledged to fight for more international recognition of Taiwan. But Nicaragua is also reportedly seeking massive Chinese investments to build a canal that would compete with Panama’s — that could be a lucrative deal in exchange for switching diplomatic allegiance.

If that’s the case, Tsai could be fighting a losing David-and-Goliath battle against the world’s second largest economy. “Beijing wants to squeeze Tsai,” Manning said, “and they’ve got trillions of dollars to do it.”

Photo credit: INTI OCON/AFP/Getty Images


Robbie Gramer is a diplomacy and national security reporter at Foreign Policy. Twitter: @RobbieGramer