For Paraguay and its new president, Taiwan ties are weighed against China’s potential economic role

World’s largest country defying Beijing’s claim of sovereignty over self-ruled island enters spotlight ahead of No 2 Taipei official’s visit to Asunción

Economic challenges nudge Paraguayan beef industry and other domestic voices to advocate for departure from status quo

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Santiago Peña, president-elect of Paraguay, belongs to the Colorado Party, which has long fostered diplomatic ties with Taiwan. Photo: EPA-EFE

Published: 11:01pm, 11 Aug 2023Updated: 4:50am, 12 Aug 2023

When Santiago Peña steps onto a stage before the Palacio de Los López on August 15 to accept the presidential sash, he will not only be inaugurated as Paraguay’s leader but also formally head up the world’s largest country still recognising Taiwan’s sovereignty.

The landlocked South American nation of 6.8 million people cemented its diplomatic ties with the self-ruled island back in 1957 during an era defined by the US-supported dictatorship of Alfredo Stroessner, an avowed anti-communist.

While Beijing’s leadership has steadily persuaded countries around the world to recognise its claim over Taiwan, Paraguay has held firm in its allegiance, for years leveraging Taipei’s technological prowess to fuel a budding electronics market.

Taiwan has nurtured the relationship, donating computers to Paraguayan schools and offering exchange scholarships as well as language courses for students. Taiwanese Vice-President William Lai Ching-te, the ruling Democratic Progressive Party’s 2024 presidential candidate, is expected to attend Peña’s inauguration, with his planned stopovers in New York and San Francisco en route that Beijing will be watching closely.

Santiago Peña, Paraguay’s incoming president, celebrates in Asunción after winning the country’s presidential election on April 30, 2023. Photo: AFP

Despite the optics, however, government sources told the Post that Peña’s close associates have signalled a need to re-evaluate the long-time stance and consider pivoting towards Beijing, a scenario complicated by Russia’s invasion last year of Ukraine.

These undercurrents in Paraguay’s domestic politics, pitting the country’s beef industry against Taiwan loyalists, are playing out amid a larger debate over relations with Beijing in Mercosur, a South American regional bloc that Asuncion is part of.