Reports from an international affairs think tank and Spanish-language news media have brought to attention how China might leverage its economic power to undermine Taiwan’s relationship with Guatemala, one of the nation’s last remaining diplomatic allies in Central America.
Guatemalan President Bernardo Arevalo has publicly stated he supports his country’s ties to Taiwan, but with China’s capacity to offer financial incentives and its growing influence in the region, it could apply pressure to the country’s political establishment that could potentially lead to the establishment of diplomatic ties.
A recent report from Geopolitical Intelligence Services (GIS), a think tank founded by Prince Michael of Liechtenstein, points to Guatemala’s close ties with the US, which has repeatedly urged the Central American country to maintain formal diplomatic relations with Taiwan.
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Although Arevalo won 58 percent of the vote in the presidential election last year, the Guatemalan Congress is controlled by opposition parties, which has led to repeated political deadlock.
If Arevalo seeks additional funds to implement his political agenda over the complaints of the legislature, he could look to China as a source of backing, which would inevitably lead to a recalibration in the country’s formal diplomatic ties with Taiwan, the report said.
In recent years, China’s profile in Central America has grown substantially. It has poached several of Taiwan’s former diplomatic allies, such as El Salvador and Honduras, and made major investments in countries such as Costa Rica, also a former diplomatic ally which severed relations with Taiwan in 2007.
Diario Las Americas, a US-based Spanish-language newspaper, published a report on Sept. 9 which quoted two experts from Latin American think tank Center for the Opening and Development of Latin America detailing how countries in the region have grown closer to China in hopes of economic benefits, but have so far seen little results from increasing engagement.
The article raises concerns regarding China’s impact on the region’s socio-environmental systems, workers’ rights and wages, and the lack of transparency in how these countries engage with China.
In recent free-trade agreements (FTA) signed with Costa Rica, Chile and Peru, China has been the primary beneficiary of all three deals, the article states.
In Costa Rica in particular, China’s FTA was a major political victory as the country was the first “domino” to fall in the region and switch diplomatic recognition from Taiwan to China, the article says.
However, since the FTA was signed in 2010, Costa Rica’s trade deficit to China has grown, exports to China have lagged significantly behind exports to the US, and China has yet to make significant investments in the country, the piece adds.
The piece warns that short-term profits from closer ties to China run counter to national interests, and that while China advocates for “win-win” relations, the evidence has yet to materialize.
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