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By Manuel Fuentes
The recent announcement by Honduras to break diplomatic relations with Taiwan and recognize the principle of “one China” is yet another turn of the screw in the political turn that Latin America is taking to recognize the giant Asia as a great economic and commercial power that increasingly has more political influence in the region.
Honduras and Taiwan, considered by China as a rebel province, had maintained an intense relationship of military, educational and economic cooperation since 1941. However, the Honduran president, Xiomara Castro, ordered her foreign minister, Eduardo Enrique Reina, days ago to establish diplomatic relations with China, which has led to a break with Taiwan.
“This is the recognition of an international situation that cannot continue to be denied and it is the positioning of China as a great power,” Luciano Bolinaga, a doctor in International Relations from the National University of Rosario (Argentina), explained to EFE.
“As this role is consolidated, China has more instruments, more tools to be able to put pressure on governments, not only in Latin America, but in different parts of the world,” says Bolinaga, director of the Asia-Pacific Study Group. from the Inter-American Open University of Rosario.
Indeed, Honduras seeks to establish relations with China to attract more investment and resolve its high foreign debt, which exceeds 9.5 billion dollars, although it leaves open the possibility of maintaining trade ties with Taiwan, with whom it has a bilateral debt of 600 million dollars that Taipei has refused to restructure.
“With its process of economic modernization, China can have a greater financial and commercial influence in Latin America”, explains Professor Bolinaga. “For most of the countries in the region, it has become the first or second trading partner, and China is also the main investor in most of them,” he adds.
Honduras is following in the footsteps of its neighbors Panama, El Salvador, the Dominican Republic and Nicaragua, which in recent years have severed diplomatic relations with the island in favor of the People’s Republic of China, something that worries the US.
Now, the list of states that have diplomatic relations with Taiwan has been reduced to thirteen. Honduras is the ninth country in the world and the fifth in Latin America that since 2016 has cut with the island.
This turn began in 1972, with the trip to Beijing by the then US president, Richard Nixon. “This political rapprochement was a wink for the countries aligned with the United States to get closer to the People’s Republic of China,” recalls Bolinaga. From that moment on, “the vast majority of the countries in the region begin to move their embassies to mainland China.”
Before Honduras, Nicaragua also turned its back on Taiwan. It was after the controversial general elections of November 2021, in which Daniel Ortega was re-elected for a fifth term. The following month, Managua reestablished relations with Beijing and broke with Taipei, until then one of its best economic partners and main cooperators. In July of last year, Nicaragua and China signed the Early Harvest Agreement, a step before the Free Trade Agreement (FTA).
“A free trade agreement does not necessarily imply the recognition of a State”, points out Luciano Bolinaga. In fact, the thirteen countries that still recognize Taiwan could sign one with China without this implying the establishment of diplomatic relations.
“Now, Beijing is not going to sign an FTA until it makes sure that it has the recognition of the one-China principle and that there are diplomatic relations,” stresses the director of the Asia-Pacific Studies Group.
Before Nicaragua and Honduras, the Dominican Republic had already established diplomatic relations with China in May 2018, breaking with Taiwan, which accused the Asian giant of having achieved it by promising loans of more than 3,000 million dollars.
Decades earlier it was the other way around. “The diplomacy of the Taiwanese dollar -explains Bolinaga- allowed it to generate investment and financing in many of these countries.”
Panama also surprisingly broke ties with Taipei in June 2017 and recognized the principle of “one China.” The following year more than thirty bilateral agreements were signed. But the investment rain never came and the current Panamanian government has slowed down the rapprochement, with which many projects have been reduced to mere announcements, among them, the FTA.
“China promises something in the future, an increase in exports or investments, in exchange for something concrete and real, such as recognition of the State and the establishment of diplomatic relations,” emphasizes Luciano Bolinaga.
But “this impressive economic and financial capacity is an instrument at the service of the political objective of the Communist Party,” he warns. “When we talk about investment, we are talking about companies that are mostly state-owned.”
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The signing of an FTA was also the reason that El Salvador announced in August 2018 the severance of relations with Taiwan and the establishment of ties with China. Last November, President Nayib Bukele said that he wanted to sign a free trade agreement “as soon as possible.”
For its part, Guatemala has maintained bilateral relations with Taiwan since November 1960 and is currently, together with Belize, the only Central American country with commercial ties with the island, and not with China. The Government of Alejandro Giammattei considers Taipei a “strategic ally for development.”
Further south, relations with Taiwan are the subject of debate in the campaign for the presidential elections on April 30 in Paraguay, a country that established ties with the island in 1957, during the dictatorship of Alfredo Stroessner (1954-1989). And while the opposition values a possible relationship with China as “an important option,” President Mario Abdo Benítez describes Taiwan as a “beacon of democracy.”
