China is picking off Taiwan’s allies

The Economist explains
Date: Jul 27th 2018
By S.D.

IF THE inauguration of a Paraguayan president next month draws international attention it will be because of one of its attendees: Tsai Ing-wen, the president of Taiwan. Paraguay is one of just 17 countries (plus the Vatican) that have diplomatic relations with Taiwan. In doing so they disqualify themselves from having formal relations with China, which considers the island nation a renegade province. They also subject themselves to intense pressure from the Chinese government to abandon Taiwan, in the form of both carrots (large investments) and sticks (tourism restrictions). So why do countries hold on, and how long can they last?

Taiwan had 28 allies in 1990. But that number is declining. China has taken four of them—Burkina Faso, Dominican Republic, Panama and São Tomé and Príncipe—in the past two years alone. According to the Chinese government, it is impossible to have diplomatic relations with both countries because they are in fact only one country. Taiwan accuses China of using “dollar diplomacy” to poach allies. Shortly before the Dominican Republic switched allegiances earlier this year, China offered it investment and loans worth some $3.1 bn, says the Taiwanese government. Taiwan itself offers enticements too: Paraguay receives money and police vehicles from the island. Shared history also helps. Paraguay and Taiwan established relations in 1957, brought together by their anti-communism.     [FULL  STORY]