Guyana Gambit Reveals Taiwan’s Potential Strategic Role in South America

Guyana Gambit Reveals Taiwan’s Potential Strategic Role in South America

Guyana Gambit Reveals Taiwan’s Potential Strategic Role in South America

In less than 24 hours following Taipei’s announcement of the opening of a “Taiwan Office” (台灣辦公室) in the South American country of Guyana on February 4, Georgetown announced that it was rescinding plans for the new representative office, reportedly due to pressure from China. Guyana’s Ministry of Foreign Affairs and International Cooperation released a press release stating: “The Government of Guyana wishes to clarify that it continues to adhere to the One China policy and its diplomatic relations remain intact with the People’s Republic of China. The Government has not established any diplomatic ties or relations with Taiwan and as a result of the miscommunication of the agreement signed, this agreement has since been terminated.” Georgetown’s decision to scrap the agreement with Taipei following a stern reaction from Beijing and a meeting between Guyana’s Foreign Minister Hugh Todd and China’s Chargé d’Affaires in Guyana Chen Xilai (陳錫來) on February 4 underscores the challenges to enhancing Taiwan’s international space. Despite the setback over the Guyana gambit, Taipei has nevertheless emerged as a key partner in supporting US policy priorities in South America.

Chinese Pressure Shuts Down Taiwan Office

Had it not been for Beijing’s intervention, Taiwan’s representative office in Guyana would have become its second overseas “Taiwan Office,” following the opening of the Taiwan Representative Office in Somaliland in August 2020. While Somaliland does not have official relations with either Beijing or Taipei, Guyana recognizes the People’s Republic of China (PRC) and not the Republic of China (ROC), which made the initial announcement about the establishment of a “Taiwan Office” all the more surprising. Typically, Taiwan’s representative offices are called “Taipei Economic and Cultural Representative Offices” in countries such as the United States that do not officially recognize the ROC.

After a new government came into power in Guyana in August 2020 following the presidential election of Mohamed Irfaan Ali of the opposition People’s Progressive Party, Georgetown and Taipei actively engaged in discussions and held talks over five months. On January 11, 2021, the two sides signed an agreement to establish the representative office—and the Taiwan Office began its initial operations four days later. However, Taipei did not formally announce the opening until February 4, nearly three weeks later. Taipei also welcomed Guyana to set up a counterpart representative office in Taiwan in the future.

Following Taipei’s February 4 announcement and the agreement’s subsequent cancellation by Georgetown, the Guyanese foreign minister, Hugh Todd, explained that the original idea was to enable Taiwan to set up an office to promote trade and investment. Todd argued that the establishment of the Taiwan Office did not mean that the two sides had established formal diplomatic relations. He said his country’s “One-China Policy” remained unchanged. Meanwhile, Permanent Secretary of the Foreign Affairs Ministry Elisabeth Harper maintained that China was aware of the Taiwan-related decisions made by Guyana in January and sought to dispel the notion that the United States was involved in Guyana’s decision-making process.

In the wake of the office’s cancellation, China was suspected of using COVID-19 vaccine delivery to put pressure on Guyana. A fateful meeting between Foreign Minister Todd and Chinese Chargé d’Affaires Chen Xilai following Taipei’s announcement seemed to have put a halt to the opening of the Taiwan Office. The Guyana government’s Facebook post stated that during his meeting with Todd, Chen confirmed that “the 20,000 vaccines earmarked for Guyana have been approved.” A statement from Georgetown called the donation “another tangible demonstration of the importance of the bilateral relationship between Guyana and China” since the establishment of official relations in 1972. Guyana is slated to receive its first vaccine shipments from China’s state-owned Sinopharm (中國醫藥集團) as early as March 2021.

Guyana’s Economic Prospects and Strategic Potential

As a former British colony that gained its independence in 1966, Guyana is the only English-speaking country in South America. It is located in the strategic northeast corner of the South American continent, bordering Venezuela and the Atlantic Ocean, and has strong historical and cultural links to the Caribbean. The country also boasts rich natural resources, including gold, diamonds, bauxite, rare metals, and forest resources. Following Exxon Mobil’s discovery of crude oil reserves off Guyana’s coast in 2015, observers have predicted that Guyana’s newfound oil resources will dramatically transform the poor nation into a global oil producer, if not one of the largest regional oil producers.

The short-lived Taiwan Office was intended to initially focus on economic, trade, and investment opportunities for Taiwanese businesses. There are reportedly only eight Taiwanese businesses currently in Guyana. However, Taiwan could tap into the ethnic Chinese communities in Guyana and neighboring Suriname to expand its commercial opportunities in the region. As noted by Taiwanese media, Guyana’s first president after independence, Arthur Raymond Chung (鍾亞瑟), who was in office from 1970 to 1980, was an ethnic Chinese Hakka from Guangdong Province.

Guyana also provides a strategic opening to the Caribbean, a major diplomatic center for Taipei. Five of the ROC’s remaining 15 diplomatic allies—Belize, Haiti, St. Kitts and Nevis, Saint Lucia, and St. Vincent and the Grenadines—are member states of the Caribbean Community (CARICOM), whose Secretariat is headquartered in Georgetown. Guyana is also a member of the Association of Caribbean States (ACS), which aims to promote intra-regional cooperation. If Taiwan is later able to reopen its representative office in Guyana, it could become a conduit for enhancing Taipei’s ties in the Caribbean.

After Taipei closed its representative office in Venezuela in 2009 over instability concerns, its interests and matters relating to the South American country were transferred to its offices in Columbia and Ecuador. Thus, there was a need for the Taiwan Office in Guyana to help expand commercial and other ties—particularly in northeastern South America—and to enhance Taiwan’s relations in the region.

Chinese Investment Projects in Guyana

In July 2018, Guyana’s then-Foreign Minister Carl Greenidge and then-PRC ambassador to Guyana Cui Jianchun (崔建春) signed an agreement that drafted the South American country into China’s Belt and Road Initiative (BRI, formerly known as “One Belt, One Road,” 一帶一路). Major Chinese infrastructure projects include a deep-water port project along Guyana’s northern coast, as well as a road project linking Guyana to China’s most important economic partner in the region, Brazil. The Guyana road project would help cut transport time to northern Brazil and would likely boost China’s overall trade relations with the region.

As with many other BRI investments around the world, the Chinese projects in Guyana have not lacked political controversy. In 2018, then-President David Granger dismissed the notion that his country would fall into a Chinese debt trap and argued that Guyana was approaching Chinese investments with its “eyes wide open.” Despite its oil boom, the country still lacked sufficient funding for infrastructure construction, which made Chinese investments an attractive option. “We cannot develop without infrastructure and we just do not have the capital to do it on our own. So, whether it comes from America, China, or Britain we have to have it, and of course we have to look for the best deal,” Granger said. However, there have been accusations that Chinese-funded infrastructure projects have failed to hire local workers and have not transferred technical skills to Guyana’s labor force, which could have benefited the country’s economic development.

Taiwan’s Potential Strategic Role in US Efforts in South America

The United States is worried about deepening Chinese economic and political influence in its traditional backyard. Beijing has supported Venezuelan President Nicolás Maduro, whom the Donald Trump administration had called to step down. In September 2020, then-Secretary of State Mike Pompeo visited Guyana, marking the first trip by a US Secretary of State to the country. His trip was primarily aimed at addressing US and regional efforts in war-torn Venezuela, while a secondary concern was to counter China’s growing visibility in the region. During the trip, Pompeo and President Ali signed a framework agreement to enhance energy and infrastructure finance and market cooperation under the Growth in Americas Initiative. Pompeo underscored that the United States would provide resources to develop Guyana’s infrastructure. In a veiled reference to China, Pompeo stated that Washington does not “operate the way other regimes do who might show up with money and then demand political retribution, or worse yet, engage in activity that is corrupt.”

Viewed from the broader US-China competition in the US’ backyard, Taiwan’s ill-fated representative office could have played a role in supporting US objectives in the region. According to Tamkang University Professor Alexander Huang (黄介正), Guyana is a point of contention within the US-China competition, and Taiwan is playing a role in helping to bolster the US side. From Washington’s perspective, countries such as Guyana that form closer ties with Taiwan would also help to “advance security, democratic values, and prosperity in the region.” Following the announcement of the office in Guyana, the American Institute in Taiwan (AIT, 美國在台協會) issued a press release urging that “all countries should be free to pursue closer ties and greater cooperation with Taiwan, a leading democracy, major economy, and a force for good in the world.”

Around the same time that Pompeo and Ali signed a framework agreement, Taiwan and the United States also concluded the “Framework to Strengthen Infrastructure Finance and Market Building Cooperation” (美台基礎建設融資及市場建立合作架構) aimed at raising private sector funds to provide greater transparency for infrastructure projects, as a counter to China’s BRI. Under the Trump administration, Taipei and Washington partnered together on infrastructure investment to promote Taiwan’s soft power in the Indo-Pacific and Latin America, as well as to contain China’s growing influence. The US elevated Taiwan as a beacon of democracy and trustworthy partner in the region, a move that served to benefit both Washington and Taipei.

Therefore, the establishment of the Taiwan Office in Guyana could have provided an additional avenue for further cooperation between Taiwan and the United States on regional affairs. Indeed, the Taiwan Office could have enabled Taipei to not only buttress US policy objectives against the China challenge, but also raise its own diplomatic profile in the region. It remains to be seen how the Joseph Biden administration will approach Latin America and South America. Although the short-lived Taiwan Office was a diplomatic setback for Taipei, sustained US-Taiwan efforts to elevate the island’s international profile could create new opportunities for continuing infrastructure investment and other collaboration in the Caribbean and South America. Despite the setback, Taipei could still play a strategically important role in bolstering US policy objectives vis-à-vis China.

The main point: The short-lived opening of Taiwan’s representative office in Guyana reveals how Taipei may be playing a strategic role in buttressing the US agenda in South America.