Only a few days ago Taiwan counted the Dominican Republic as one of just 19 nations that recognise the island as an independent country.
Neither the US or Australia have been bold enough to take that step. Though the Holy See has.
But China has been busy wooing Taiwan’s friends away. And the Dominican Republic caved in to China’s ‘soft diplomacy’ this week. This came in the form of a US$3 billion (AU$4 billion) low interest loan to fund much needed infrastructure in the impoverished country.
Cash in hand, the Dominican Republic announced they will no longer recognise Taiwan.
Needless to say, Taiwan’s government is less than pleased. They’d pledged US$35 million of support themselves, but China outspent them. By almost 1,000%.
You can see how a small, poor nation like the Dominican Republic could be swayed by the sight of US$3 billion. But its government should be careful what they wish for.
Just ask Sri Lanka.
Chinese loans to Sri Lanka have begun to pile up. As Bloomberg notes, ‘China’s Belt-and-Road Billions Come With a Cost’:
‘The country [Sri Lanka] now spends 80 percent of government revenues paying down what Prime Minister Ranil Wickremesinghe has called “unprecedented” debts. Last year, Wickremesinghe — who took office after Rajapaksa lost the presidency — sold the port to a Chinese firm for $1.1 billion to ease the debt burden.’
In the 21st Century, the saying ‘Beware of Greeks bearing gifts’ may need to be amended.
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