In a major victory for Beijing, which continues to lure away the dwindling number of countries that have formal relations with the self-ruled island, Panama has established diplomatic ties with China and while breaking ties with Taiwan.
Panama was establishing full diplomatic links with the second most important customer of its key shipping canal and was upgrading its commercial ties with China, Panamanian President Juan Carlos Varela said in a televised address on Monday.
“I’m convinced that this is the correct path for our country,” Varela said.
Taiwan’s government it would not compete with China in what it described as a “diplomatic money game” and said it was sorry and angry over Panama’s decision.
“Our government expresses serious objections and strong condemnation in response to China enticing Panama to cut ties with us, confining our international space and offending the people of Taiwan,” David Lee, Taiwan’s minister of foreign affairs, told a briefing in Taipei.
Although Taiwan President Tsai Ing-wen says she wants to maintain peace with Beijing, China is deeply suspicious of her, who it thinks wants to push for the island’s formal independence.
Although Taipei struggles to compete with an increasingly powerful China, but often dangling generous aid packages in front of developing nations, China and Taiwan have tried to poach each other’s allies over the years.
Taiwan’s remaining formal ties are with mostly smaller and poorer nations in Latin America and the Pacific and had as many as 30 diplomatic allies in the mid-1990s.
Panama’s Foreign Minister Isabel de Saint Malo met China’s Foreign Minister Wang Yi signed a joint communiqué establishing ties in Beijing.
“The two countries’ governments agreed to develop good friendly relations on the principles of mutual respecting sovereignty and territorial integrity, non-aggression, mutual non-interference in internal affairs, mutual benefit, and peaceful coexistence,” China’s Foreign Ministry said in a statement on its website.
With Taiwan belonging to the Asian giant, it recognized there was only one China, Panama’s government said in a statement and that it was severing ties with Taipei.
“The Panamanian government is today breaking its ‘diplomatic ties’ with Taiwan, and pledges to end all relations or official contact with Taiwan,” the statement said.
In an attempt to get them to break ties with Taiwan, China has been showering largesse on countries throughout Central America in recent years and the establishment of links with Panama is a coup for China.
He did not expect any change in Panama’s relations with Taiwan or China, Panama’s deputy foreign minister had said as recently as December.
The Central American country could become the next nation to break ties, some diplomats in Beijing had speculated even though Panama is one of Taiwan’s oldest friends.
Tsai did not stop in Panama while visiting Central American allies earlier this year.
His interest in establishing ties with China was expressed 10 years ago by Panama’s foreign minister de Saint Malo said President Varela while in Beijing.
The future of a Chinese-backed project to build another Central American waterway to rival the Panama Canal in Nicaragua could also come under question by Monday’s diplomatic move.
While critics have raised questions about its feasibility, when it was announced in 2013, the Nicaraguan scheme was met with widespread incredulity and was earmarked at a cost of $50 billion.
(Adapted from CNBC)