Taiwan’s Last South American Ally Faces Beijing Blitz

The China Paraguay Taiwan triangle is intensifying as Beijing escalates a charm offensive aimed at peeling away Taipei’s last diplomatic ally in South America. A Reuters investigation found that at least 19 Paraguayan lawmakers have accepted fully sponsored trips to China since late 2023, visiting technology hubs, health facilities, and the Great Wall on itineraries arranged through Beijing’s consulate in São Paulo. The trips — which accelerated sharply in 2025 and continue with more planned for March — have convinced several opposition legislators that Paraguay is missing out economically by maintaining ties with Taiwan rather than switching recognition to the People’s Republic. The Rio Times, the Latin American financial news outlet, examines how great-power competition is playing out in one of South America’s smallest but most strategically significant countries.

China Paraguay Taiwan: Why Paraguay Matters

With just 6.4 million people, Paraguay punches far above its weight in the China-Taiwan diplomatic contest. It is one of only 12 countries worldwide that formally recognize Taipei, and the last holdout in South America — a continent where Panama, the Dominican Republic, El Salvador, Nicaragua, and most recently Honduras have all switched to Beijing after sustained lobbying and promises of trade and infrastructure investment. A Paraguayan flip would deliver Beijing a symbolic victory in its campaign to isolate Taiwan internationally, and would leave Taipei with no formal allies on the South American mainland.

The economic argument that Chinese officials reportedly pressed on visiting lawmakers is straightforward: Paraguay’s main exports — soy and beef — cannot be sold directly to China because Beijing refuses to trade with countries that recognize Taiwan. Instead, Paraguayan commodities are routed through Argentina and Brazil at reduced margins. Meanwhile, Chinese imports into Paraguay reached a record $6 billion in 2025, creating a massive trade imbalance that Beijing frames as solvable through diplomatic recognition switch.

Both Sides Court Asunción

The diplomatic tug-of-war involves three competing powers. China‘s approach has centered on sponsored travel — participants described luxury hotels, lavish banquets, and guided tours of advanced medical facilities and high-speed rail stations, with officials repeatedly telling them Paraguay was “running out of time.” Beijing’s Foreign Ministry told Reuters the exchanges were “mutual efforts” that require “no lobbying,” but lawmakers who participated described a coordinated campaign with a clear message: that recognizing Taipei has “no future.”

Taiwan has countered with its own outreach, funding Paraguay’s new parliament building and a university campus under construction, while inviting ruling Colorado Party legislators to Taipei. Taiwanese embassy officials in Asunción told Reuters they are actively lobbying to offset China’s advances through television appearances and legislative engagement. Washington has also moved to shore up Paraguay’s alignment: in January, Asunción signed a defense pact with the United States, joined Trump’s “Board of Peace” initiative, and participated in a White House critical minerals summit. The U.S. also lifted sanctions on former President Horacio Cartes, a mentor to current President Santiago Peña — a gesture widely read as a reward for maintaining the Taiwan relationship.

What Comes Next

President Peña has publicly reaffirmed his commitment to Taipei, telling his podcast in December that every Latin American country that switched from Taiwan to China “ended up worse off than Paraguay.” His administration has more than two years remaining, giving him little incentive to shift a policy that underpins both his foreign relations and his alliance with Washington. But analysts note that succession battles within the ruling Colorado Party could produce fissures, potentially pushing factions toward opposition groups that have been historically more open to recognizing Beijing. A recent poll by consultancy Metro showed growing public support for establishing relations with China, though the firm declined to reveal who commissioned the survey. The China Paraguay Taiwan contest is unlikely to produce a dramatic switch under the current government, but Beijing is clearly playing a longer game — building relationships, planting economic arguments, and positioning itself for the political opening that may come when Paraguay’s next electoral cycle begins.