MALAWI RECOGNITION OF BEIJING ONE YEAR IN THE

C O N F I D E N T I A L SECTION 01 OF 02 LILONGWE 000040

SIPDIS

SIPDIS

AF/S FOR ELIZABETH PELLETREAU

E.O. 12958: DECL: 01/18/2018
TAGS: PREL PGOV TW CH MI
SUBJECT: MALAWI RECOGNITION OF BEIJING ONE YEAR IN THE
MAKING

REF: LILONGWE 17

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Classified By: Ambassador Alan W. Eastham for Reasons 1.4 b, d.


1. (C) Summary: On January 14, Foreign Minister Joyce Banda
officially announced Malawi's change of recognition from
Taipei to Beijing. The announcement noted the establishment
of diplomatic ties between Malawi and the People's Republic
of China as of December 28, 2007. Formal Government approval
of the switch came (belatedly) in a Jan. 14 cabinet meeting
with the President. In a conversation with the Ambassador,
Minister of Finance Goodall Gondwe commented that the
decision to switch was a year in the making, and was driven
largely by the President himself. Mutharika sought to
maximize the potential financial windfall for Malawi by
making the switch before potential Nationalist Party (KMT)
victories in Taiwan's elections could improve cross-Straits
relations and diminish Beijing's interest, Gondwe said. While
there has been no official word on how much aid Beijing will
supply, the effects of the departure of Taiwan are already
being felt in Malawi. End Summary.


2. (C) On January 14, Foreign Minister Joyce Banda
officially announced that the government of Malawi had
decided to recognize the People's Republic of China (PRC) and
had established formal diplomatic relations as of December
28, 2007. The announcement came immediately after the
conclusion of President Mutharika's first cabinet meeting
since the agreement was signed in Beijing.


3. (C) In a conversation with the Ambassador on January 16,
Minister of Finance Goodall Gondwe confided that the decision
to switch recognition from Taipei to Beijing had been almost
a year in the making. Gondwe commented that President
Mutharika was the driving force in the decision. Mutharika
expected the potential aid package that China would offer to
entice Malawi to switch could diminish if the KMT were to win
upcoming elections. Malawi viewed a KMT government in Taipei
as more likely to improve cross-Straits relations and lessen
Beijing's desire to poach an out-spoken Taiwan supporter like
Malawi. Negotiations took longer than expected, leading to
the signed agreement on December 28, just before Taiwan's
parliamentary elections. COMMENT: The discrepancy between
the effective date and the announcement resulted, we believe,
from insistence on Cabinet approval by those who opposed the
switch. With President Mutharika on holiday at the lake, the
Cabinet meeting took some time to arrange. END COMMENT.


4. (C) News reports indicate that a PRC technical team is
currently surveying development projects that the Taiwanese
government will soon abandon in Malawi. Although there has
been no official word on the amount of aid Beijing will
supply , the effects of Taiwan's departure are already being
felt in country. The Taiwanese contractor building the
Karonga-Chitipa road in northern Malawi has already packed up
its equipment and abandoned the project. Taiwanese
Department of Health officials have also begun to dismantle
their operations at Mzuzu Central Hospital, which could leave
close to 5000 HIV patients without anti-retroviral treatment
(ART) and significantly reduce other services at the tertiary
referral hospital covering the entire northern region of
Malawi. A Ministry of Health HIV unit director confided to
CDC director that the HIV unit had not considered
contingencies for the patients' treatment and Taiwanese
Health officials asked the U.S mission and other donors to
consider storing Taiwan's medical equipment and supplies.
It's not clear what impact will be seen on the construction
of Malawi's new National Assembly building, which has
received significant Taiwanese support.


5. (C) Comment: Local reaction to the policy change has been
broadly supportive, though some have expressed concern and
surprise at the disrespect shown to Malawi's long-term friend
in the process. At the same time, Malawi's opposition
parties, the business community, and most elements of civil
society seem to have accepted the move, even without knowing
the details of the PRC incentive package. Malawi's
delegation to Beijing to sign the agreement consisted of
Minister of Presidential Affairs Davies Katsonga, Minister of
Commerce and Industry Ken Lipenga, Minister of Transport
Henry Mussa, Minister of Energy and Mines Henry
Chimunthu-Banda, and the president's brother and newly

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announced "chief advisor" Dr. Peter Mutharika. These men
appear to be among the closest advisors to the President at
the moment. The absence of the foreign minister in the
process was also noteworthy. Further, the lack of
contingency planning for the handover of crucial
Taiwan-supported projects such as the ART in Mzuzu show that
the decision to switch to Beijing was not broadly consulted
or systematically considered. Additional resource flows
(whatever they turn out to be) appear to have been the sole
factor in the decision. End Comment.
EASTHAM