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As China seeks to further whittle down the list of seven countries in the Americas that still recognize Taiwan, U.S. officials increasingly believe Paraguay may be the island’s next diplomatic ally to flip loyalties to Beijing.

Taiwan President Tsai Ing-wen’s visit this week to Guatemala and Belize to shore up two remaining Central American partners underscored her government’s efforts to head off further defections after Honduras switched its recognition to China last month. read more

But some U.S. policymakers and independent analysts see Paraguay as the likeliest to ditch Taiwan in the near term, especially if the South American country’s opposition wins the April 30 elections and makes good on its promise to embrace China, as its agricultural lobby has demanded.

“Paraguay is clearly up for grabs,” said Benjamin Gedan, who advised former U.S. President Barack Obama and is now director of the Latin America program at the Wilson Center think tank in Washington.

Further erosion of the Taiwan camp would be another blow to the U.S., which has had little success stemming the tide of Taipei’s diplomatic losses, and a fresh sign of China’s growing footprint in Washington’s neighborhood.

Reuters spoke to three U.S. officials and several other sources close to the matter who see the Biden administration with limited options for halting the gradual drift toward China, with some saying Taiwan itself appeared resigned to losing more allies in the Americas.

It is a more pessimistic view than President Joe Biden’s aides have expressed publicly and, U.S. sources say, helps to explain Washington’s muted response to Honduras’ recent ditching of Taiwan, which was seen as a lost cause.

While acknowledging that countries have the right to their sovereign decisions, two U.S. officials told Reuters it may now be more important for Taiwan to expand its role in multilateral institutions such as the World Trade Organization than to focus on keeping diplomatic allies.

Taiwan itself has publicly signaled that it no longer wants to compete head-to-head in Latin America with a far-richer China on the basis of “checkbook diplomacy,” the dangling of aid and investment, to keep its remaining 13 allies worldwide from leaving the fold.

“We don’t have a large enough checkbook,” one Taiwan official said.

The White House did not immediately respond to Reuters' questions on the issue.

The Chinese Embassy in Washington called self-ruled Taiwan "an inalienable part of China" and said the one-China principle was an "overwhelming trend" internationally. "China is willing to develop relations with all countries in the spirit of equality and mutual respect," it said in a statement.

PARAGUAY NEARS TURNING POINT?

At the center of China’s approach is the claim by its Communist leadership that democratically ruled Taiwan belongs to the mainland despite the objections of the island's government.

Beijing has been angered by what it sees as stepped-up U.S. support for Taiwan, including Tsai’s stopovers in New York and California on her latest trip, and has vowed to bring the island under its control, by force if necessary. read more

Taiwan views its diplomatic partners as a way to bolster international legitimacy and facilitate economic engagement, while China aims to strip away any attributes of statehood from what it considers a renegade province.

With Paraguay’s elections looming and the China question high on the agenda, Taiwan officials are hoping that relations remain on track with the last nation in South America still aligned with it, according to a source familiar with Taipei’s thinking.

Paraguay’s vote could be a turning point on the issue for the landlocked, California-size country of 6.7 million – and a decision with significance far beyond its borders.

Opposition candidate Efrain Alegre, a centrist lawyer, told Reuters in January he would cut ties with Taiwan and open relations with China if he wins the presidency, hoping to boost crucial soy and beef exports. {nL1N33P1RG}

But the ruling conservative Colorado Party candidate, Santiago Pena, has vowed to maintain recognition of Taiwan. A cross-party delegation visited the island in February seeking to calm Taiwanese jitters.

Polls suggest the contest will be close. Though the Colorado Party has dominated for decades, it has been plagued by corruption scandals and complaints from the agricultural sector about lack of access to the lucrative Chinese market. read more

Some analysts question whether Alegre would be able to muster legislative support to ditch Taiwan. If he does, it would mark a dramatic shift in a relationship that date backs to 1957 under two U.S.-backed autocrats, Taiwan’s Chiang Kai-shek and Paraguay’s Alfredo Stroessner.

Pressure has been building for years for Paraguay, a top-10 global beef exporter and fourth largest soybean exporter, to reconsider its ties with Taiwan, a small but robust democracy.

Around three years ago, Chinese diplomats made their economic case for a switch in a meeting with Paraguayan farmers and lawmakers near the Iguazu waterfalls on the border with Brazil, two Paraguayan participants told Reuters.

Paraguay’s trade volume with China has doubled over the last eight years and is far larger than with the United States, UN Comtrade data show, but this is driven by imports while exports to the world’s no. 2 economy remain tiny.

“Having trade relations with China is going to be favorable for producers and for the country,” said Eno Michels, president of Paraguay's Soybean Producers Association.

He acknowledged, however, that either of the candidates may still change his stance once sworn into office in August.

Even if the ruling party retains power, some analysts believe resentment within its ranks over January U.S. sanctions on Colorado politicians could drive Paraguay into China’s arms.

“No matter which candidate from which party wins, our government will continue to work with the new government of Paraguay to deepen cooperation and exchanges,” Taiwan’s Foreign Ministry said.

In Washington, the Chinese Embassy said Beijing "does not interfere in other countries’ internal affairs" and declined comment on the Paraguay situation.

HONDURAS AS A WARNING SIGN

China’s poaching of Honduras may have been a harbinger.

When Taiwan temporarily averted a split with Honduras after President Xiomara Castro took office in January 2022, U.S. State Department officials remained wary. read more

In March, a U.S. assessment that Honduras’ left-leaning government had already made up its mind to switch to China, in a bid for more investment from the Asian giant, led to the restrained U.S. response, said one person with knowledge of U.S. thinking.

U.S. officials were reluctant to be seen forcefully backing a losing position. Still, Washington was quick to warn that China’s investment promises often go unfulfilled and create “debt traps” for developing nations.

The Biden administration is also keeping a close eye on tiny Belize for any cracks in its Taiwan relationship. Belize officials have privately complained that economic benefits from those ties have not met expectations, according to one person familiar with the matter.

Taiwan’s only other Central American ally is Guatemala, considered steadfast in its support. The four others in the region are Haiti, Saint Vincent and the Grenadines, Saint Kitts and Nevis, and Saint Lucia.

There is some skepticism among Washington policymakers that more diplomatic losses in the Americas would have significant impact, assuming Taipei maintains support from strategic countries closely linked to the U.S., such as the Marshall Islands in the Pacific.

Two U.S. officials said Washington was putting less stock in Taiwan maintaining its diplomatic allies in favor of efforts to increase its participation in international organizations.

While denied a seat in the United Nations, Taiwan is a member of the WTO and the Asia-Pacific Economic Cooperation forum. China, however, has blocked it from being upgraded from observer status in the World Health Organization.

Taiwan itself also appears more interested in enhancing unofficial ties with like-minded partners in Europe such as Lithuania and the Czech Republic than in competing to maintain scant diplomatic recognition, the U.S. officials said.

But some U.S. lawmakers are concerned about the trend, which includes five nations in the Americas switching allegiance in just over five years.

U.S. Representative Mike Gallagher, Republican chairman of the House Select Committee on the Chinese Communist Party, told Reuters that China was trying to isolate Taiwan, possibly as a prelude to invading the island, and was “taking advantage of our complacency.” (Reuters)

Taiwan's defence ministry said on Wednesday a Chinese aircraft carrier group was in the waters off the island's southeast coast, the same day President Tsai Ing-wen was due to meet U.S. House Speaker Kevin McCarthy in Los Angeles.

China, which claims democratically-governed Taiwan as its own territory, has warned of unspecified retaliation if the meeting goes ahead.

China staged war games around Taiwan last August following the visit to Taipei of then-House Speaker Nancy Pelosi.

Taiwan's defence ministry said the Chinese ships, which were led by the carrier the Shandong, passed through the Bashi Channel which separates Taiwan from the Philippines and then into waters to Taiwan's southeast.

It said the ships were going for training in the Western Pacific, and that Taiwanese naval and air forces and land-based radar systems closely monitored them.

"The Chinese communists continue to send aircraft and ships to encroach in the seas and airspace around Taiwan," the ministry said.

"In addition to posing a substantial threat to our national security, it also destroys the status quo of regional security and stability. Such actions are by no means the acts of a responsible modern country."

The ministry provided two pictures - one a grainy black and white image of the carrier taken from the air, and the other of a Taiwanese sailor looking at the Shandong and another unidentified ship in the distance.

China has yet to comment on the carrier group, whose appearance also coincided with the arrival in Beijing of French President Emmanuel Macron.

China has sailed its aircraft carriers near to Taiwan before and at similarly sensitive times.

In March of last year, the Shandong sailed through the Taiwan Strait, just hours before the Chinese and U.S. presidents were due to talk.

Taiwan's defence ministry, in its statement about the Shandong's latest mission near the island, said that "external pressure will not hinder our determination to go into the world".

Taiwan's military will continue to closely monitor the situation in the Taiwan Strait, and uphold the principles of "not escalating conflicts, not causing disputes" to deal with any challenges. (Reuters)

For the past two decades, Malaysian mother Siti Zabidah Muhammad Rasyid has been hoping for a miracle to save her son Razali from death row.

He was sentenced to death 23 years ago after breaching Malaysia's tough laws on drugs when he was caught with 851 grammes (1.9 pounds) of cannabis.

But Siti Zabidah's prayers were answered this week when parliament passed sweeping legal reforms to scrap Malaysia's mandatory death penalty.

"The joy was immense," said a tearful Siti Zabidah, speaking from her apartment in the state of Selangor, near the capital Kuala Lumpur.

She said her son said a friend forced him to carry the drugs and then made him a scapegoat after being arrested.

A judge rejected an earlier attempt by the family to file an appeal against the sentence.

She recounted how she collapsed after hearing the judge's decision, fearing the legal avenues for her son were shut.

"I can go on without a husband but not without my children," she said.

More than 1,300 people facing the death penalty or life imprisonment in Malaysia - including those who have exhausted all legal appeals - can seek a sentencing review under the new rules passed on Monday.

The amendments apply to 34 offences currently punishable by death, including murder and drug trafficking. Eleven of those have stipulated death as the mandatory punishment.

For now, life imprisonment sentences, defined by Malaysian law as a fixed term of 30 years, will be retained.

The fate of Siti Zabidah's son lies in the hands of the courts, which will decide on a possible alternative sentencing or punishment.

Alternatives to the death penalty under the new rules include caning and a jail term of up to 40 years.

Siti Zabidah said she would stand by her son whatever happened.

"As long as I'm alive, I'll give him strength," she said. (Reuters)

Japan on Wednesday said it plans to offer countries financial assistance to help them bolster their defences, marking its first unambiguous departure from rules that forbid the use of international aid for military purposes.

Japan's Overseas Security Assistance (OSA) will be managed separately from the Overseas Development Assistance (ODA) programme that for decades has funded roads, dams and other civilian infrastructure, Chief Cabinet Secretary Hirokazu Matsuno said at a regular news conference.

"By enhancing their security and deterrence capabilities, OSA aims to deepen our security cooperation with the countries, to create a desirable security environment for Japan," the Ministry of Foreign Affairs said in a statement.

The change comes as Japan undertakes its biggest military build-up since World War Two in a marked shift away the pacifism that is set out in its constitution and has dominated its political discourse for decades.

Any aid under the new arrangement will not be used to buy lethal weapons that recipients could use in conflicts with other countries in accordance with three principles that govern arms exports, the foreign ministry said.

Specific projects are expected to include satellite communication and radio systems for maritime surveillance, and preparations are underway for the first aid to be finalised within this fiscal year, the ministry said.

The first recipients will likely be the Philippines, Malaysia, Bangladesh, or Fiji. The foreign ministry opened a bid on Wednesday to start an OSA feasibility study in those countries, with an eye on strengthening their maritime security.

Japan is considering providing radars to the Philippines to help it monitor Chinese activity in the contested South China Sea, the Yomiuri newspaper reported on Monday.

In principle, only developing countries will be eligible for the aid given that it will be provided as grants, according to the foreign ministry.

The decision to expand the scope of international aid to military-related projects follows Japan's announcement in December of a doubling of defence spending in five years as it looks to counter China's growing military might.

Following on from the overhaul of its military strategy, there is growing momentum over the easing of Japan's arms export ban. The ruling coalition is looking to start working-level discussions in late April over loosening the current arms export restrictions, according to broadcaster TBS, in line with similar suggestions made under the new strategy.

Japan has also been increasing its contacts with developing nations in an effort to counter China. Prime Minister Fumio Kishida announced a $75 billion investment across the Indo-Pacific in March as he seeks to forge stronger ties with South and Southeast Asia. (Reuters)