Diplomatic coercion. The tug-of-war between China and Taiwan and its implications.

Diplomatic coercion. The tug-of-war between China and Taiwan and its implications.


On 12th of June, president of Panama publicly announced cutting diplomatic ties with the ROC, in favor of establishing relations with the PRC.  Almost at the same time a Taiwanese academic group was denied visiting the public gallery at the UN human rights office and referred to the new internal guidelines, which only accept documents issued by PRC. Taiwan, with currently 20 officially recognising it and maintaining diplomatic relations states (including the Holy See), is continuously exposed to Chinese use of geoeconomics and coercive diplomacy, at both multi- and bilateral level. This ongoing process should be perceived as Beijing’s attempts to advance her understanding of One China policy as well as for direct dealings with ROC. Striving to fulfil strategic objectives, states are no longer using only military coercion or conquest; frequently they are favoring use of geoeconomics as a major instrument of foreign policies.

Nexus between economic involvement in Africa, Central and South America and political power manifestation include both Taiwan and China. This trend, involving South-South cooperation, was intended to take advantage of the economic crisis of Western countries, but currently it’s perceived as an effective way of implementing recognition of One China policy. In the past ten years China was intensifying her diplomatic efforts to compel or persuade African and South- and Central American countries to severe diplomatic relations with Taiwan by increasing FDI. Malawi, which pledged disavowal of bilateral relations with Taiwan in 2008 has been provided by China with financing for high-profile infrastructural and educational projects. Costa Rica, which broke off ties with Taiwan in 2007 received aid of similar character: persuading this country into severing relations with ROC meant for China foreign direct investment worth approximately $300 million in bonds. The last quarter of 2013 brought change also to Taiwan – Gambia relations, with the latter cutting diplomatic ties with ROC. Interestingly, short time before the announcement, PRC and São Tomé and Príncipe agreed on signing an agreement for the opening of a trade mission in order to facilitate Chinese investments on a big scale[i].  Strengthening the cooperation might also entail “chequebook diplomacy” which doesn’t end with the countries that are yet to recognise PRC. In January 2017, during a foreign minister’s visit in Nigeria, Chinese representative predicated investments of equivalent of around $40 billion. From the Nigerian side, the deal encompassed a promise of withdrawing any form of recognition of Taiwan, most importantly closing Taiwan’s office in Abuja[ii]. China is also using her financial resources and political privileges to punish any state that expresses support for ROC. By threatening to block UN peacekeeping operations in Macedonia in 1999, China coerced the country to severe diplomatic relations with ROC (2000). In 2006 Vietnam invited Taiwan to participate in the Asia–Pacific Economic Cooperation (APEC) summit in Hanoi, which resulted in suspension of Chinese aid (approximately $200 million).

Ties of Panama and Taipei reach as far as to 1922. The course of events was predictable for some time already: in 2009 Panama’s president publicly stated his plan to establish relations with the PRC as well – to no avail due to PRC’s unwillingness at that time. China has been one of three largest user of the Panama Canal, and it was the Chinese cargo to be transit through it after completion of an expansion project in 2016. China convinced Panama to break off relations with Taipei by investing equivalent of $1 billion in the Panama Canal modernisation in order to upgrade facilities to adjust them for docking larger ships. Long-term character of Chinese financial support and turning Panama into an important transit route and potentially a port hub for Chinese goods, proved to be a good incentive. According to La Estrella de Panama newspaper, Chinese Landbridge Group purchased the biggest port of Panama (Margarita Island Port) in 2016, and as the Panama Canal Authority will open a tender for developers of land around the canal, also the Chinese state firms will inevitably look for opportunities to gain from the new partnership.

China increasingly manifests her awareness of how even slight, but persistent threat is useful for defending the status quo regarding reunification as well as so called 1992 Compromise, compared to directly trying to forge progress toward reunification. Diplomatic and economic encirclement strategy is slowly isolating Taiwan from remaining international allies. Since 2016 elections, Beijing was systematically cutting off official exchanges, outwardly manifesting its discontent from DPP win.

Implementation of Beijing’s vision of reunification is reinforced by pressuring Taipei with a broader range of geoeconomic tools.  Activities of this kind are part of Chinese efforts aimed to isolate Taiwan not only as an extension of global economic policy or general diplomatic efforts, but most importantly as a component of Chinese Three Warfares strategy. This concept encompasses psychological operations, actions targeting public opinion and media, as well as the legal ones. Purpose behind the first one is to shock, demoralise, and deter, a great example being pressuring the new DPP administration in order to undermine or influence Tsai’s policy and reforms. Overt and covert media manipulation is predominantly understood as integrated measures applied in order to shape attitudes of the Chinese (both domestic and foreign). Legal manipulation of perception of target audience, mostly abroad, is designed to use global governance institutions in order to isolate and pressure Chinese opponents : supporters of Taiwanese sovereignty. Furthermore, it could be understood as the use of domestic and international law to secure objectives and shaping conditions on the ground to support application of legal principles, also by influencing foreign decision makers.

In a short run, Beijing’s actions result in Taiwan’s being excluded from various multilateral forums, to name a few: World Health Assembly (WHA), the International Civil Aviation Organization (ICAO), Interpol. But by increasing the pressure to alienate ROC internationally, China in fact intends to achieve one overarching goal: ultimately persuade Taiwanese population that reunification is unavoidable. China aims for a shift in the public opinion that would prove unification to be is not only inevitable, but also welcomed by the Taiwanese. From the security perspective, the question is therefore: can the status quo be maintained. Currently public opinion polls available (2015-2017) were concluding mild to overwhelming support for the status quo, with the majority of the questioned public expressing disbelieve for the 1992 Consensus. Diplomatic coercion  encompasses also decrease in the flow of tourists[iii], blocking Taiwanese efforts to obtain the observer status at the WHO meeting, detention of DPP affiliated activist Lee Ming-che, among others. In legal terms the policy of reunification by peaceful means was reaffirmed by the Chinese government in 2005 by passing the Anti-Secession Law. Furthermore, this act also provides guidance should the non-violent mechanisms be completely exhausted, with non-peaceful measures specified as a way to protect China’s sovereignty. China strives for maintaining the perception of being a unified, multinational country. This principal foreign policy postulate underpin territorial integrity postulate, related to “One China” rule – a premise for questioning Taiwanese independence and sovereignty. PRC is manifesting lack of tolerance for any forms of encroachment upon what’s understood as its national unity.

Cross-strait liberalisation of economic constraints has proven to be a source of indirect leverage for Beijing over Taiwan. Cutting ties with partners like Panama is inevitably increasing dependency on China, which poses a threat to smooth functioning of ROC’s economy. With president Chen Shui Bian legalising investment in China with “three small links” negotiations after 2008 new perspective for cross-Strait economic relations had opened. Furthermore, then-administration also initiated negotiations on student exchanges and work permits, allowing at the same time for high investments. From a national security perspective it was a prelude to demographic challenges as well as increasing trade dependency and brain drain, as China has gradually become Taiwan’s largest export partner (over 40% of domestic production), the second-largest source of imports, and number one destination for the FDI. China, developing high-tech industries, is an inevitable competitor for Taiwanese manufacturers, causes a desperate needs for diversity in Taiwanese customer base in order to stop this negative effect. Chinese dominance in trade is moreover an impediment in developing trade cooperation with other, less profitable, partners. China additionally employs reinforcement to this pattern: it leverages its economic weight against states which would nevertheless try to sign trade agreements with Taiwan without PRC’s approval. Such actions additionally reinforces Taiwan’s diplomatic isolation. What is more, controversial ECFA bilateral agreement, which sparked many protests, might be considered a poorly designed model of FTA: it forces Taiwan onto even deeper integration in the regional economical dynamics. Aforementioned protest reinforced an public perception of Taiwan loosing as a regional power – fact eagerly exploited by mainland. Moreover, this agreement is not helpful in countering protectionism – and the risk of Taiwanese dependency on trade provides China with a leverage dangerous due to the politically divisions.

This being said, one of the major reasons for Taiwanese prosperity was its trade exchange with China. Proponents of China are highlighting historical symmetry, as it was Taiwan that first invested into China during Deng Xiaoping reforms, together with sharing Taiwanese business and technological expertise. Due to their cultural and linguistic affinities and complementary economies, this kind of exchange seems to be natural from the theoretical perspective. Ease of access to the market further support close linkage in a production chain, being an incentive for business to cooperate with China.

The perception of Taiwan’s defense is also a subject to non-kinetic operations of China. Diplomatic coercion’s objective is to limit the willingness of the countries inclined to support Taiwan to come to its defense in any way. The role of Taiwan in the global security community is unquestionable, both from the perspective of nontraditional security as well as countering emerging threats. It is enough to mention the Ramzi Yousef accident, when one of the main perpetrators of the first WTC attack flew from Hong Kong to Taoyuan International Airport (1994) in order to test security systems. Not only that – among more recent situations one can analyse the SARS outbreak, especially in the context of Taiwanese bid to join the World Health Assembly (WHA) in Geneva in 2017 and successful Chinese attempts to undermine it. It is not an isolated case, more recently PRC’s lobby resulted in ROC’s delegation expulsion from the Kimberley Process meeting. As an important manufacturer and important of IT and rich country with well developed market of luxury goods, Taiwan was participating in the KP with an observer status since 2007. Blocking efforts of the PRC include also 2016 International Civil Aviation Organization (ICAO) assembly, the Interpol general assembly and the OECD Steel Committee international steel symposium.

The loss of allies and most importantly trade partners like Panama has psychological implications, as it bears certain symbolism in terms of prestige, understood as the international recognition.  Chinese strategy of economic encirclement of Taiwan does have economical consequences of various scale, but it does not undermine Taiwan’s ability to retain all the characteristic of sovereign state – intended push in the direction of eventual reunification is not the ultimate or direct one. Repercussions of loosing official allies in an economic and political sense cause DPP domestic pressure. Furthermore, it serves as an argument for the Kuomintang, which is  trying to pivot the public opinion while claiming that it is better suited to negotiate with PRC, and ready for accommodation of Chinese demands on “1992 Consensus.”  Finally, suppressing Taiwan on the international arena help boost Xi Jinping’s image before the nineteenth Chinese Communist Party Congress. With the reunification as an ultimate goal, China has no interest in openly antagonizing domestic and foreign Chinese population, and therefore all the actions, despite representing hardline approach, remain within a frame of limitations which is intended to help maintaining the illusion reassuring that the potential reunification will not deprive the Taiwanese their privileges. For China, the diplomatic isolation of Taiwan is also related to chances of decline in political support for Tsai Ing-wen, and the perception of inevitable push of voters to the Kuomintang. Chinese diplomatic efforts create in fact opportunities for pro-independence actors within Taiwan, such as the New Power Party (NPP). With roots in student movement against closer ties with China, it is even more openly supporting de jure independence than the DPP and very vocal with anti-One China views. Chinese attempts to isolate ROC internationally might in fact help in fostering a sense of Taiwanese identity and result in phenomena opposite to intended, pushing further young Taiwanese electorate to support parties like the NPP.

China is undoubtedly in a better position to pursue her interests on the international arena – due to the cross-Strait power asymmetry, Taiwan will constantly be at risk of PRC withdrawing from any promise it had given. Growing economical dependence, reinforced by changing political dynamics are inevitably influencing fluctuating public support, naturally helping Chinese actions. Secondly, the cross-strait relations are not isolated from state actors other than ROC and PRC, and will not be decided by the Taiwan only. It has to be mentioned, that despite lack of official recognition, Taiwan fosters strategic relations with economies like the United States, the EU and Japan. Furthermore, Taiwan is developing New Southbound Policy, in order to improve economic and cultural exchange with Southeast Asian countries. Main competitors of China in the region, the US and Japan, are historically entangled in the tension while competing over diplomatic and economic influence, and in case of Japan – also territorial rivalry . Historically, the US acknowledges that China expects other states to adhere to One China principle. At the same time Washington ties to balance between not recognising Chinese control over Taiwan and, at the same time, not recognising Taiwan as a sovereign state. President Trump’s decision to call to Tsai Ing-wen just after she assumed the office could be perceived as lack of predictability in the US-ROC relations character – such fluctuation had happened before, albeit on a smaller scale. In general the US support has been a crucial factor for Taiwan’s international perception. Finally, there’s no quantifiable method of measuring PRC’s patience regarding reunification and her military or political actions or intentions (in case the situation does not change quickly enough in the political direction it wants) are unknown. Despite having in mind increasingly nationalistic and expansionist character of the PRC politics, arguing that Taiwan has little choice and should be subdued would not be an acceptable scenario. Tsai’s administration must actively combat Chinese efforts and strengthen public morale. The national will is viewed by PRC as a key target of psychological warfare – an ongoing process occurring both in peacetime, as well as war. Taiwanese population, due to historical conditions and cultural proximity is invariably susceptible to psychological warfare. Indirectly, diplomatic feud between PRC and ROC is contributing to the growing perception of security tension in Asia, resulting in increased defense spendings. A solution to this situation can be found in appealing to the other nations self-interest, as increased unofficial cooperation between Taiwan and states important in the international arena helpful in successfully mitigating the threat.




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[i] São Tomé and Príncipe cut diplomatic ties with Taiwan in December 2016.

[ii] Moreover, the presence of Confucius Institutes (CI) is furthering Chinese soft-power efforts. On June 18th The Chinese Embassy in Madagascar offered new scholarship to 53 students at the CI at Tamatave University.

[iii] In 2009 PRC tourists were advised to cancel their visits due to the plans of screening a documentary about Uighur political dissident Rebiya Kadeer.

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