TAIWAN VERSUS CHINA IN AFRICA: DOWN BUT NOT OUT

C O N F I D E N T I A L SECTION 01 OF 03 TAIPEI 001154

SIPDIS

SIPDIS

E.O. 12958: DECL: 05/18/2032
TAGS: PREL PGOV XA TW
SUBJECT: TAIWAN VERSUS CHINA IN AFRICA: DOWN BUT NOT OUT

Classified By: AIT Deputy Director Robert S. Wang,
Reasons: 1.4 (b/d)


1. (C) Summary: Taipei plans to host an Africa Summit this
September to shore up bilateral relations with the five
African countries that still recognize Taiwan following the
losses of Senegal and Chad over the last two years. The
summit in part is a response to Beijing's growing influence
in Africa, which MOFA officials say poses a "major challenge"
to Taiwan's diplomatic work there. Despite Beijing's
campaign to undermine Taiwan's diplomatic relationships, MOFA
officials remain confident that relations with the five
African partners are "firm" and do not foresee any defections
in the coming year. While African ambassadors in Taipei
expect their home governments to stay with Taiwan for now,
some are expressing hope that Taipei will do more to assist
their countries. End Summary.

Summit Aims to Strengthen Ties...
--------------


2. (C) On April 28 Taiwan announced plans to host an
Africa-Taiwan Summit in September for the leaders of its five
African diplomatic partners (Burkina Faso, The Gambia,
Malawi, Sao Tome and Principe, and Swaziland). Foreign
Ministry officials said the summit will focus on helping the
five countries overcome challenges posed by globalization,
particularly in the fields of information technology,
environmental protection, and energy technology. MOFA Acting
Director-General for African Affairs Jack Wu underscored to
AIT that the summit will provide an opportunity for President
Chen Shui-bian to strengthen personal relations with the
heads of the five African nations. Taipei plans to unveil
new projects aimed at reducing poverty and promoting economic
development. Turning to specifics, Wu noted that the
initiatives are likely to focus on agriculture, ecotourism,
energy production, and e-government. Taiwan also plans to
expand existing medical and technological assistance missions
to the five countries.

...And Resist Beijing's Growing Pull
--------------


3. (C) The summit aims in part to counter Beijing's growing
influence in Africa, which Wu suggested poses a "major
challenge" to Taiwan's diplomatic work in the continent.
Beijing's announcement of over USD 20 billion in various loan
and aid packages at the China-Africa Summit last November
demonstrates China's growing clout in Africa, Wu asserted.
National Chengchi University (NCCU) Professor Yen Chen-shen
noted that China has been courting African countries by
unveiling substantive aid commitments and promoting
head-of-state visits. Gambia Ambassador Mawdo Juwara
suggested that visits by PRC President Hu Jintao, Premier Wen
Jiabao and previous Foreign Minister Li Zhaoxing in recent
years were "unprecedented" for Africa. Sao Tome and
Principe's Ambassador Ladislau D'Almeida predicted that
within 15 years China's influence in Africa might overtake
that of the US and the Europeans, which is causing African
countries now to begin thinking about the implications for
them of the rise of China.


4. (C) AIT's contacts say that although China's primary
interest in Africa is securing raw materials and expanding
markets, it is also pressuring Taiwan's allies to switch
diplomatic recognition to Beijing. According to MOFA
official Wu, the PRC has recently made overtures to leaders
in Malawi, Burkina Faso and Sao Tome. Taiwan's two other
partners, Swaziland and the Gambia, are also at risk of being

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courted by Beijing, Wu added. Taiwan International
Cooperation and Development Fund (ICDF) Secretary-General
Chen Cheng-chung told AIT that Taiwan's small, aid programs,
though efficient and transparent, "cannot compete" with the
vast sums that the PRC and its state-owned companies can
provide. Since Taiwan does not have the resources to compete
across the continent, Taipei's strategy is to concentrate
attention and resources to retain its five remaining allies,
Wu said. Professor Yen explained that part of the conundrum
facing Taiwan is that it can only hope to hold onto countries
that are small and weak. Countries that are large,
regionally powerful, have extensive natural resources, or
need peacekeeping assistance from international
organizations, need to "work" with Beijing in regional and
international forums, and hence are unlikely to stick to, or
recognize, Taiwan.

Holding onto Remaining Partners
--------------


5. (C) Despite Beijing's unrelenting campaign to undermine
Taipei diplomatically and Taiwan's resource constraints,
Taiwan officials remain confident that relations with the
five African allies are "firm" and do not foresee any
defections in the coming year. Wu said that Malawi and
Swaziland are especially solid allies. Taiwan-Gambia
relations are also fairly stable, as shown by Premier Su's
attendance at President Jammeh's inauguration last December.
As its diplomatic partners decrease, Taiwan gives more
attention to the remaining allies, noted Wu. Taiwan conducts
a wide range of programs in resource-poor countries, such as
Burkina Faso and Swaziland, which have little to offer the
PRC. Beijing is also sometimes limited in its ability to use
African states that recognize the PRC to pressure Taiwan's
allies to switch recognition, Professor Yen suggested. For
example, South Africa refuses to pressure Swaziland because
of the benefits both derive from the Taiwan business presence
in Swaziland.

Competing Assistance Programs
--------------


6. (C) Some African ambassadors, looking with envy at
Beijing's stepped-up engagement with the continent, have
expressed hope Taipei could "do more" to help their
countries. The Gambia and Sao Tome Ambassadors both
expressed admiration for the PRC's investments, citing the
construction of a $75 million US dollar airport in Maputo,
Mozambique, as well as hospitals and soccer stadiums
throughout Africa. In contrast, Ambassador D'Almeida
complained, Taiwan "is not doing nearly enough" to promote
development in Sao Tome. Visits by Sao Tome President to
Taipei and extensive negotiations with local textile
companies have yet to yield concrete investments, added the
Ambassador.


7. (C) AIT's contacts suggest that the PRC continues to
push forward in Africa, despite some resentment against its
growing presence. For now, however, Taipei's African
partners agree that Taiwan's assistance is better than what
the PRC is willing to offer. Beijing also has more to do to
convince Taiwan's allies that it will follow through on
grandiose promises of aid and investment. Taipei's African
partners agree that Taiwan's vocational training schools and
medical assistance teams, though small in scale, offer
practical, tangible assistance compared with hypothetical
commitments by Beijing. Taiwan's allies understand that "if
Taiwan makes a promise, Taiwan keeps it," Director Wu said,
pointing out that Taipei is assisting in the renovation of

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airports in Swaziland and the Gambia while the PRC has yet to
complete promised factories in Zambia.

Taipei's "Weakest Link" -- Sao Tome and Principe
-------------- ---


8. (C) Of Taiwan's five African partners, Sao Tome, with
its potential for oil development, may be the most vulnerable
to PRC inducements. According to our contacts, Sao Tome has
been working with Nigeria on a 40-60 split to develop an oil
field in its territorial waters. Professor Yen expects the
PRC to use its close relations with Nigeria and its influence
as an oil consumer to pressure Sao Tome to switch recognition
to Beijing. Ambassador D'Almeida told AIT that Sao Tome is
placing its hopes on oil to fund other projects, and has "no
choice" but to work with Nigeria on oil development.
Nevertheless, D'Almeida did not believe that Sao Tome would
bow to pressure that could possibly come from Nigera on the
issue of switching recognition to Beijing. Director General
Wu told AIT that Taiwan plans to discuss an airport
renovation and a taro-processing project at the summit in
order to cement Taipei's ties with Sao Tome. John Hsu,
Deputy CEO of the China Petroleum Corporation (CPC) told AIT
that although CPC has one engineer stationed full-time in Sao
Tome to evaluate the development's feasibility, CPC considers
the prospects for cost-effective oil extraction to be
limited.

"Dollar Diplomacy"
--------------


9. (C) In the PRC-Taiwan competition for diplomatic
recognition, both sides resort to "dollar diplomacy."
Director Wu criticized Beijing's dollar diplomacy in the
region, pointing to unconditional aid policies and support
for unsavory regimes in Zimbabwe and the Sudan. Taiwan
itself, however, does not remain immune from using dollar
diplomacy in its quest for allies. Secretary-General Chen
suggested that although the ICDF's programs are completely
transparent, other Taiwan agencies carry out "under-the-table
activities." Pan-Blue legislators in Taiwan have, for
example, accused MOFA of giving large sums of money to Gambia
during Jammeh's last election campaign. Professor Yen raised
concerns that such actions lack transparency and could
undermine progress towards good governance in Africa.

Comment
--------------


10. (C) After losing Senegal in 2005 and Chad last year to
the PRC, Taiwan is stepping up efforts to hold onto its five
remaining African partners. Taipei's decision to host an
Africa Summit this September is an important part of these
efforts. While the Foreign Ministry appears confident of its
ability to prevent further losses in the short term, the
competition between Beijing and Taipei will continue and
well-placed "dollar diplomacy" has the potential to produce
sudden, unexpected reverses.
YOUNG