How Are The Pacific Island Countries Benefiting From The China-Taiwan Chequebook Diplomacy
Economic Growth Is A Byproduct For Some Countries
When two parties are fighting over something, the third party takes it all -
Polish Proverb
The Pacific Island Countries, excluding New Zealand, consisting of 14 small island countries with a cumulative population of only 2.3 million people. Along with their population, when you consider their geographic size and placement, you realise that outside help in the form of aid is crucial to their growth as nations.
According to the World Risk Index of 2019, the Pacific Island countries are the most vulnerable to natural disasters and the effects of climate change. Five of these countries are ranked as in the list of 20 most at-risk countries in the world. Hence, no matter how small a country, but if the island nation of Tuvalu were hit with a natural disaster, the eleven thousand citizens of that country would take years to get the country back to normal without aid, because for such a small population this country is not quite that small.
Some of the other major issues that these nations face that makes it crucial for them to depend on foreign aid are:
Limited natural resources
Narrow based economies
Large distance from and major markets
Vulnerable to external shocks such as wars and epidemics
While the largest donor over the years has been Australia as these countries directly and indirectly (through the trade routes that go through their waters) contribute to Australia’s GDP, China has been playing catch up and is currently ranked third just behind the United States with Taiwan also making regular contributions.
So what has got China and Taiwan interested in providing aid to the Pacific Islands countries
A small detour to the China Civil War
To understand China’s interest, a country with over 1.4 billion people and robust economic growth, in the Pacific Island Countries we need to go back in time to the Chinese Civil War and the events that took place subsequently.
Without getting into too many details, the Chinese civil war lasted almost 22 years and ended in 1949 with the Communist Party of China (CPC) coming out victorious. This meant that the Chinese Nationalist Party (CNP) lost control of mainland China and was forced to retreat to Taiwan, also known as the Republic of China (ROC).
At this time, the governments in both countries, the PRC in mainland China and the ROC in Taiwan, were claiming to be the legitimate government of all China. However, the turning point in this political dispute and claim of China was put to rest in 1971 when the United Nations voted by a two-thirds majority to change China's representation from the Republic of China to the People’s Republic of China.
This event led to every major country recognising the PRC as China and not the ROC. What also added further pressure to this recognition was that the PRC had an implied rule that if a country was to engage in any international relations with them, it must not do so with Taiwan (ROC). As a result, today, there are only 17 nations that officially recognise Taiwan as a legitimate and separate nation, and some consist of the Pacific Island Countries.
Why is the recognition of small island countries important to Taiwan?
Although the United States is the 11th largest trading partner of Taiwan, it never recognises it as the Republic of China, as the People’s Republic of China is a far more important and strategic frenemy to have, no matter how complex the relationship.
As the bigger and powerful nations will not publicly recognise Taiwan, Taiwan has chosen to win over the smaller nations. One of the major reasons to do so is that these small nations will further their agenda in the United Nations General Assembly. It is one of the only meetings where no matter your political clout, the size of your army, or your country's size, every country gets only one vote.
This means that despite having 0.12% of the world’s population, the Pacific Islands account for 6% of the votes.
This is why a small island country like Tuvalu, with just eleven thousand, can influence Taiwan's agenda at the UN General Assembly. Hence, they get a great deal of financial aid. It is implicit quid pro quo.
To put things in context, two million dollars of aid given to Mexico will have a relatively much lesser impact than the same money given to Tuvalu. Hence, the strategy here could be to win over the smaller countries first to be recognised and thus represented in an organisation, leading to global acknowledgement someday.
Chinese aid and the beginning of Chequebook Diplomacy
With Taiwan trying to win over the Pacific Island countries, China had to get involved sooner or later. Their reason was simple and singular in nature. Make Taiwan handicap by disintegrating every relationship it has, forcing it to cede to Mainland China and fulfil the One-China rule.
The best way to do this was with the help of Chequebook Diplomacy Strategy.
Chequebook diplomacy is used to describe a foreign policy which openly uses economic aid and investment between countries to curry diplomatic favor.
Being a much larger country and having significantly larger resources at their disposal, China knew that economic aid would be a far more effective tool to cripple Taiwan. Hence, they began providing much more aid with the condition that if the Pacific Islands countries want this aid to continue, they would have to stop dealing with Taiwan and terminate all diplomatic ties.
To a great extent, this strategy has been working. Since 2016, Chequebook diplomacy has successfully helped China win over seven of Taiwan’s allies (not all Pacific Island Countries). In 2019, the latest one to make a move was Kiribati. They were gifted aeroplanes and several ferries for the switch amongst other things.
Currently, it seems like the Pacific islands have it all going for them from an economic perspective. They are getting ample aid from China and Taiwan and other countries and organisations around the world.
However, the money and resources that are coming in from the China-Taiwan feud are limited in time. Not because these countries lack the resources and capital, but because the purpose of helping these island nations is not out of the kindness of their hearts but for strategic reasons.
For Taiwan, it is to get diplomatic recognition from the bigger countries someday, and for China, it is to stop that from happening.
Two key reasons could stop the aid coming in from both these countries in the future:
If China and Taiwan unite under the One China Policy and operate under PRC rules and regulations
If Taiwan gets its independent diplomatic recognition
Once either of the two agendas is met, the Pacific Islands lose their usefulness for China and Taiwan. And, when they are no longer useful, the pawns are the first to be sacrificed.
Until next time…