Paraguay vows to defend ties with Taiwan amid growing Chinese influence in Latin America

Paraguayan Foreign Minister Rubén Darío Ramírez Lezcano said Friday that the country remains committed to diplomatic relations with Taiwan despite calls from the agricultural sector for it to move into formal relations with China.

At the same time, Ramírez Lezcano said his government is open to establishing trade and other relations with Beijing, as long as it does not have to sever its ties with Taiwan. Paraguay is one of only 12 countries that maintain diplomatic relations with Taiwan, and the only one in South America.

“Paraguay is open to establishing diplomatic, consular or commercial relations with China without conditions,” Ramírez Lezcano told the Voice of America and five other American news organizations.

“We remain committed to supporting the government of Taiwan and do not accept any conditions for severing our relations with Taiwan,” he said.

Paraguay has been seeking to gain access to the Chinese market through a trade agreement between Beijing and the South American Common Market, known by its Spanish acronym Mercosur, which includes countries such as Argentina, Brazil, Bolivia and Uruguay, in addition to Paraguay.

“Our position with China is one of total openness,” Paraguayan President Santiago Peña said during an August interview with Reuters. “We are in favor of advancing trade agreements.”

However, talks for a trade agreement between China and Mercosur They have so far been thwarted by disagreements among Mercosur members and China’s insistence that any country seeking relations with Beijing must renounce its diplomatic recognition of Taiwan.

“Principles and values” also matter

Ramírez Lezcano reiterated this Friday that economic benefit is not the only consideration for Paraguay when deciding whether to maintain diplomatic relations with any country.

“The most important factors are principles and values, rather than just commerce and money,” he said.

Analysts affirm that Paraguay’s recognition of Taiwan is not the only obstacle to a trade agreement between China and Mercosur. Some countries in the bloc also fear overdependence on China and the impact a deal would have on their own industries.

Kung Kwo-Wei, an expert on Latin American affairs at Tamkang University in Taiwan, noted that Brazil imposed new tariffs in October on imports from China and other Asian countries, such as iron, steel and fiber, and described the measure as an effort to combat dumping and protect Brazil’s national industries.

“Mercosur can only sign a free trade agreement with China if all member states approve the proposal, but so far there is no consensus among all member states because Brazil remains cautious about the measure,” said Su Yen-pin, an expert. in Latin American affairs from National Chengchi University in Taiwan.

“Given that Paraguay has repeatedly said that it will not break diplomatic ties with Taiwan in exchange for signing trade agreements with China, that makes it impossible for Mercosur to approve the free trade agreement with China in the short term,” he told the VOA by phone.

China has repeatedly emphasized that Taiwan is an inalienable part of China and has urged Paraguay to “follow the trend of history.”

“We hope that the government and leader of Paraguay will follow the trend of history, satisfy the aspiration of its people, stand on the right side of history as soon as possible, join the overwhelming majority of the international community and take the correct decision that serves the fundamental and long-term interests of the country,” Chinese Foreign Ministry spokesman Mao Ning told reporters in August.

Trade with Taiwan

While Paraguay is unlikely to sign trade deals with China any time soon, experts say Taiwan faces pressure to increase its imports from Paraguay and its investments there.

“Members of the Paraguayan Congress tend to discuss the benefits for Paraguay of maintaining ties with Taiwan, and there is a growing feeling among Paraguayan agricultural companies that they are losing many economic benefits by maintaining ties with Taiwan,” said Fabricio Fonseca, assistant professor of diplomacy at National Chengchi University in Taiwan.

He said that while Taiwan continues to increase its imports of meat and other agricultural products from Paraguay, farmers in other Mercosur states want the greater access to China’s market that a trade deal would offer, contributing to pressure on the Paraguayan government.

“From time to time, not just during election cycles, we see these pushes to discuss the issue of Paraguay’s relations with Taiwan in Congress, and this will continue to affect bilateral relations between Taiwan and Paraguay,” Fonseca told the VOA by phone.

Paraguay has also been seeking more Taiwanese investment. Ramírez Lezcano said Asunción is trying to attract more Taiwanese investments in the high-tech sector.

“Taiwan is establishing an industrial park in Paraguay and we are working to establish a technology ecosystem with Taiwanese companies,” he told reporters on Friday.

While Taiwan has sent several trade delegations to Paraguay in recent years, some Taiwanese analysts say the number of Taiwanese companies investing in Paraguay remains limited.

“Paraguay is geographically far from Taiwan, and Taiwanese companies often think that it is difficult to ensure a smooth transfer of industrial technology to Paraguay,” he told the VOA by phone Kung Kwo-Wei, an expert on Latin American affairs at Tamkang University in Taiwan.

Despite Taiwan’s limited private sector investment in Paraguay, Kung said the United States and Taiwan are working together to help Paraguay expand its private sector.

“In 2021, Taiwan and the United States worked with Paraguay to boost the growth of its renewable energy and electric vehicle sector, and the three countries also jointly established several small business development centers,” he said.

Despite the challenges, Su in Taiwan said Paraguay’s ruling Colorado Party is unlikely to achieve major change.

“Unless there is a regime change in Paraguay’s upcoming elections, there will not be much opportunity for China to influence diplomatic relations between Taipei and Asunción,” he told the VOA.

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