Why Might Taiwan’s Allies in Latin America and the Caribbean Soon Look to China?

Supportive rhetoric carries little weight in the face of economic challenges and countries’ objectives. Four key factors can incentivize a country to engage with China.


Photo: Panamanian Foreign Minister Isabel de Saint Malo de Alvarado and Chinese Foreign Minister Wang Yi toast after signing a diplomatic agreement in June 2017 / Greg Baler / Getty Images

The new Nicaragua-China relationship has left Taiwan with only 14 global allies, eight of which are in Latin America and the Caribbean (LAC). As in prior cases, such as Panama and the Dominican Republic, LAC countries’ decision to recognize China is rooted in both domestic and external motivations.

Global economic uncertainty due to climate change, stagnant economic growth, and the effects of the COVID-19 pandemic increases the willingness of Taiwan’s LAC allies to engage with China. Simultaneously, political leaders and parties use recognition of China to shore up domestic voter bases with promises of future large-scale investment or other material resources. Going forward, these same factors can influence future outreach to China. Simply put, the potential for future switches in diplomatic recognition depends on the will of the LAC leaders and the circumstances they find themselves in.

Taiwan’s eight remaining LAC allies (Belize, Guatemala, Haiti, Honduras, Paraguay, St. Kitts and Nevis, Saint Lucia, and St. Vincent and the Grenadines) have all expressed renewed support for Taiwan in recent months. Guatemalan President Alejandro Giammattei reconfirmed his country’s intent to support Taiwan in December 2021, as did officials representing the incoming Honduran president Xiomara Castro—a notable change in tune from her pledge to develop relations with China during her campaign. Paraguayan president Mario Abdo likewise reaffirmed support for Taiwan after a new donation of medical supplies and newly financed infrastructure and agricultural projects.

Caribbean Community (CARICOM) members also reiterated support for Taiwan in 2021. Taiwan and Haiti highlighted diplomatic ties with Haitian authorities during the country’s post-assassination unrest. St. Kitts and Nevis’s ambassador donated homemade snacks to Taiwanese frontline medical workers at a hospital in Taipei, and St. Lucia signed an economic development agreement with Taiwan worth $2 million for youth entrepreneurship and employment. St Vincent and the Grenadines expressed commitment to Taiwan in August 2021 by highlighting Taiwan’s natural disaster relief funding following a volcanic eruption.

Yet supportive rhetoric carries little weight in the face of economic challenges and countries’ objectives. Four key factors can incentivize a country to engage with China. First, global events such as the pandemic and natural disasters can wipe away years of growth over the span of a few days or months. As of 2020, LAC is the second most disaster-prone region in the world, and Taiwan’s Eastern Caribbean allies are disproportionately affected by the pandemic due to their tourism-dependent economies. Responding to pandemics and natural disasters are costly, and multilateral institutions are ill-equipped to support these countries post-disaster.

The size of small states’ economies means that Taiwanese aid is still competitive, although the sheer amount of Chinese financial assistance is greater. Frequent natural disasters are likely to incur additional costs and incentivize Taiwanese allies to seek quick and large assistance—an area in which China has proven useful for its own allies over the past decade. Chinese aid helped in recovery efforts after hurricanes swept across Central America and Colombia in 2020, as well as after Hurricane Maria in 2017. The benefits of China’s disaster relief diplomacy were also on display during the pandemic. While LAC allies received personal protective equipment from Taiwan, China is reported to have courted Paraguay with promises of vaccine doses. Taiwan’s foreign minister and Paraguayan officials claimed that third-party brokers with alleged ties to China offered Paraguay Chinese-made vaccine doses if Paraguay switched diplomatic recognition from Taiwan to China.  

Second, opposition groups seeking to win local and national elections or new incumbents looking to deliver on campaign promises might engage with China. Large-scale infrastructure, particularly for smaller countries, is an attractive incentive for leaders to shore up voter bases. While building large scale infrastructure can incur additional debt, the promise of a new bridge or cricket or soccer stadium via Chinese support is any easy way to captivate constituents. Pundits noted the same considerations were at play for Honduran President-elect Castro during her campaign and that a strong interest in “mega projects” and development funding drove her openness to relations with China.    

Third, recognizing China expands a small state’s foreign policy options. At the moment, the United States and China are the preeminent great powers engaged with LAC. Taiwan’s allies’ foreign policy is limited, while their neighbors are able to maneuver between the United States and China to secure political and economic capital. Trinidad and Tobago did so during the pandemic by bringing almost two million vaccines to the twin-island republic from the United States and China. This was in direct contrast to Taiwan’s Eastern Caribbean allies, who waited on COVAX and U.S. donations that arrived well behind and in fewer amounts than the first Chinese donations to LAC.

Finally, given the ideological bent that is sometimes attributed to recognizing China, full-blown or partial authoritarian leaders can use a diplomatic switch to legitimize themselves among the other authoritarian governments. For small states, opportunities for regional and international legitimacy build leaders’ personal brands while also allowing them to advocate for their country’s needs at a much grander scale. In the case of Nicaragua, the Ortega government was criticized for authoritarian tendencies while it remained an ally of the United States and Taiwan. Although it is currently too early to determine, it is possible that the Ortega government switched to recognizing China in part to relieve external pressure and clearly signal its anti-democratic intent.  By aligning with China, Ortega may be able to tap into Chinese development funds that are not contingent on government transparency.

Each factor on its own, let alone a combination of factors, would be enough to incentivize Taiwan’s LAC allies to reach out to China. For Honduras, campaign promises and a broadened foreign policy landscape may play a heightened role in the short term. As President Castro receives pressure to deliver on her campaign pledge and attempts to fortify Honduras’s image abroad, Honduras may diversify its diplomatic portfolio by engaging with China. Guatemala is also likely to increase its diplomatic allies as it navigates allegations of authoritarianism. President Giammattei’s rocky relationship with the Biden administration over migration policy and systemic corruption may induce him to explore other non-U.S. diplomatic partners such as China. With upcoming Paraguayan elections in 2023 and polls displaying a high level of public dissatisfaction towards the incumbent president, the same campaign promises recently at play in Honduras may sway Paraguay’s relationship with Taiwan as well. Absent any large shifts in domestic politics or natural disasters, St. Kitts and Nevis and Belize will likely remain allies of Taiwan in the near future.

Saint Vincent and the Grenadines’ Prime Minister Ralph Gonsalves is likely to remain allies with Taiwan in the short-term. Advocating for Taiwan on the international stage brings Gonsalves legitimacy as a small state leader. And given the small size of his country’s economy, Taiwanese aid is sufficient. Saint Lucia’s incumbent political party, which entered office in July 2021, also led the country in 1997, when the government broke off relations with Taiwan and recognized China. After the opposition returned to office, St. Lucia resumed relations with Taiwan in 2007. Although the Prime Minister has indicated that there are no plans to recognize China, history suggests that a switch can occur if one or a combination of the aforementioned factors materializes as climate change worsens and national elections come back around. Further, as Haiti’s political and economic circumstances worsen, the likelihood of a diplomatic switch is growing. However, this will depend on the political ambitions of current and future leaders. While it can be economically advantageous to recognize China and reap the developmental benefits, it might not be politically feasible. Haiti needs bipartisan support from the United States, and as anti-China sentiment grows, a diplomatic switch from Taiwan could result in even less U.S. support for Haiti’s political leaders.

As these eight countries demonstrate, beneath the surface of bilateral meetings and declarations of support, Taiwan’s allies need to weigh natural disasters, electoral pressure, foreign policy considerations, and authoritarian signaling as they chart their next foreign policy moves. Ultimately, the future trajectory of Taiwan’s allies in LAC will be determined by these countries’ own decision-making agency.

Wazim Mowla is the assistant director of the Caribbean Initiative at the Atlantic Council’s Adrienne Arsht Latin America Center. Isabel Bernhard is a program assistant at the Atlantic Council’s Adrienne Arsht Latin America Center.

The views represented in this piece belong to the authors and do not represent the institutional position of the Atlantic Council or its affiliate centers.

See also:

Evan Ellis: Nicaragua’s Flip to China: What Does It Mean for the Region?

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