Paraguay has made headlines by expelling Xu Wei, a senior Chinese diplomat, for urging the country to sever ties with Taiwan and align with Beijing. The move underscores Paraguay’s steadfast commitment to Taiwan, despite increasing Chinese influence in Latin America. But this decision is more than a simple diplomatic dispute—it has significant ramifications for the region’s geopolitics and Paraguay’s relationship with both China and Taiwan.

What Happened?

Xu Wei was attending a UNESCO meeting in Paraguay when he stirred controversy by appearing at the Paraguayan Congress and openly calling for lawmakers to abandon Taiwan. In his address, Xu offered Paraguay the prospect of expanded trade opportunities with China, framing the decision as binary: “It is either China or Taiwan.”

Paraguay responded swiftly. Declaring Xu persona non grata, the Foreign Ministry revoked his visa and gave him 24 hours to leave the country. Foreign Minister Ruben Dario Ramirez Lezcano stated that Xu’s actions constituted interference in domestic affairs, a violation of diplomatic protocol.

Why Did Paraguay React This Way?

Paraguay is one of only 12 countries—and the sole nation in South America—that maintains formal diplomatic ties with Taiwan. Since 1957, Paraguay has stood by the self-governing island, despite pressure from Beijing. China’s “One-China” policy forces countries to choose between recognizing Taiwan or China, and Beijing has successfully wooed many of Taiwan’s former allies, including Honduras, Panama, and El Salvador.

However, Paraguay views its relationship with Taiwan as a matter of principles and values, not just economic interests. Leaders in Asunción argue that diplomatic ties with Taiwan are a testament to their commitment to sovereignty and democracy.

Taiwan has reciprocated by fostering deep economic and political ties with Paraguay. Recent efforts include establishing industrial parks and investing in renewable energy and high-tech sectors. Taiwan’s embassy in Paraguay denounced Xu’s actions, calling him an “infiltrator” attempting to undermine the partnership.

Economic Temptations and Regional Context

China’s economic footprint in South America is immense. In 2023, trade between China and the region reached $500 billion, with countries like Brazil and Argentina reaping substantial benefits. Paraguay’s agricultural sector—particularly soybean and beef farmers—has expressed frustration over limited access to the lucrative Chinese market. Some Paraguayan lawmakers argue that shifting allegiance to China could open new economic opportunities.

Xu’s remarks targeted these economic pressures, offering expanded trade and financial advantages if Paraguay switched its allegiance. However, Paraguayan officials have resisted, emphasizing the importance of diversifying trade relationships without compromising their principles.

Ramifications for China-Paraguay Relations

The expulsion of Xu Wei is a clear signal that Paraguay will not tolerate overt interference from Beijing. It is also a rebuke of China’s aggressive diplomacy, which often involves leveraging economic incentives to achieve political ends. By standing firm, Paraguay has strengthened its reputation as a stalwart ally of Taiwan and a country that prioritizes sovereignty over economic expedience.

For China, the incident represents a missed opportunity to add another South American ally to its growing roster. Beijing has been expanding its influence across Latin America, securing partnerships that have isolated Taiwan diplomatically. Paraguay’s refusal to yield suggests that Beijing’s approach has limits, particularly when confronted by nations with strong ideological commitments.

What Others Are Saying

• Taiwan: Officials in Taipei praised Paraguay’s decision, reaffirming the “firm friendship” between the two nations. Taiwan’s embassy in Asunción condemned Xu’s actions as an attempt to disrupt decades of cooperation.
• Analysts: Some experts suggest that China’s miscalculation in Paraguay may signal overreach. “Beijing underestimated the depth of Paraguay’s commitment to Taiwan,” noted one Latin American affairs specialist.
• Critics within Paraguay: Not everyone agrees with the government’s stance. Certain lawmakers and business leaders argue that maintaining ties with Taiwan comes at a steep economic cost, citing missed opportunities for trade with China.

The Broader Implications

Paraguay’s decision is a rare challenge to China’s dominance in Latin America, where Beijing has increasingly consolidated its influence. It also highlights Taiwan’s precarious position on the global stage. While Taiwan continues to invest in its allies, the economic pull of China remains a formidable challenge.

This diplomatic clash may also impact Paraguay’s role within Mercosur, the South American trade bloc. Discussions about a potential trade agreement with China have been complicated by Paraguay’s insistence on maintaining ties with Taiwan, further illustrating how geopolitics can influence economic policies.

ACZ Editor: It is alarming that China has become more aggressive in bullying countries in Latin America. Rest assured this is not over, China will become more overt in its threats to Paraguay and its pressures on other Latin American countries to help it force Paraguay to dump Taiwan. Unfortunately, the incompetent Biden Administration neglected Latin America and allowed China to get its hooks in.

This needs to stop.

This may be the opportunity for the U.S. to work toward recognizing Taiwan, in the face of Chinese belligerence. I’m not sure anyone has the guts for this.