Taiwan losing ground to Beijing in the Caribbean

San Juan, December 11, 2014 (EFE).- Taiwan is losing ground in the Caribbean, one of its traditional strongholds, as global economic powerhouse China expands its presence in the region, experts told Efe yesterday.

"Globalization has changed the rules because the financial capabilities of each country are like night and day," University of Puerto Rico economist Paul Latortue said in an interview.

The interest of China and Taiwan in the Caribbean region goes back to the decolonization of the islands in the 1970s, as Beijing and Taipei vied for diplomatic recognition from the newly independent countries.

The Chinese government will not maintain diplomatic ties with countries that recognize Taiwan, which Beijing officially regards as a rebel province of China.

Peruvian researcher Alejandro Sanchez told Efe that Taiwan identifies with the Caribbean islands, whereas China sees the region almost exclusively in economic terms.

Latortue said China's construction of large ports in the Bahamas and Jamaica is a sign that Beijing wants to expand trade in the region and with the U.S. East Coast.

"China thinks more about economic development rather than to dominate politically and territorially," he said, noting that Taiwan is primarily moved by a concern to maintain diplomatic recognition.

Sanchez, a specialist in international relations for the Council on Hemispheric Affairs, said China aims to expand its economy and invests large sums of money to achieve that goal.

As explained by Sanchez, Caribbean nations' stance on the China vs. Taiwan diplomatic dispute typically fluctuates with how much money they get from Beijing and Taipei to finance projects.

A clear example is a loan Taiwan gave to Grenada to finance infrastructure, according to a report published in 2012 by Sanchez. In 2005, the Caribbean island, saying that it could not repay Taiwan, chose to recognize China in exchange for financial assistance to prevent the closure of an airport.

"The Caribbean is easily susceptible to China's cash," Council on Hemispheric Affairs director Larry Birns said in a phone interview.

Birns, an expert on Latin America, spoke of "a huge amount of corruption happening in the Caribbean" and said the tendency to play off one country against another is part of a "game of extortion”.

Another case in point is St. Lucia, which established ties with Taiwan in 1984, but recognized China in 1997, only to switch back to Taipei a decade later.

According to a May 2014 report of the U.S.-China Economic and Security Review Commission, China's aid to the Caribbean is "modest" because "the region does not have the potential to directly affect China's primary security interests in Asia”.

"Nevertheless," the report added, "Beijing likely views the Caribbean as strategically important by virtue of its proximity to the US”.

Birns predicts that "Taiwan is going to be eliminated as a key player" in the region mainly because "it is not able to keep up with China in terms of high-cost subsidies as well as financial grants”.

Sanchez and Latortue agreed that Caribbean countries will prefer to recognize China diplomatically, turning away from Taiwan.

"These leaders know how to be pragmatic and they know they can win more with China than with Taiwan," Sanchez said.

Latin America and the Caribbean accounted for 12 of the 22 nations that maintained diplomatic relations with Taipei in 2013, according to Taiwan's foreign ministry.