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Cablegate: Paraguay: Dialogue with Taiwan On Prc Wha

This record is a partial extract of the original cable. The full text of the original cable is not available.

311534Z Aug 05

S E C R E T ASUNCION 001095

SIPDIS

NSC FOR SUE CRONIN
SOUTHCOM FOR DAN JOHNSON

E.O. 12958: DECL: 08/19/2015
TAGS: EAGR ECON EFIN EMIN ENRG ETRD ETTC PHUM PREL CH PA
SUBJECT: PARAGUAY: DIALOGUE WITH TAIWAN ON PRC WHA
ACTIVITIES

REF: STATE 143649

Classified By: PolCoun James P. Merz for reasons 1.5 (b) and (d).

1. (S) The Taiwanese Ambassador to Paraguay took up his
assignment this year. The Ambassador has infrequent social
contact with him but believes the Taiwanese Ambassador would
be amenable to contact on PRC activities. The Polcouns has
relatively frequent social and professional contact with the
Taiwanese Polcouns who has been assigned to Paraguay for over
four years.

2. (U) Paraguay is the only country in South America that
maintains diplomatic relations with Taiwan and supports
Taiwan's petition for UN membership. This policy is a legacy
of the anti-Communist Stroessner regime. In exchange for GOP
recognition, Taiwan provides the GOP with assistance ranging
from USD 5 to 10 million per year. The modern structure that
houses the Paraguayan Congress was constructed several years
ago with Taiwanese funds. Taiwan also paid for complete
renovation of the Foreign Ministry building. In the past
year, Taiwanese funds have gone toward construction of
housing for low income families and the purchase of land for
poor campesinos. Taiwan regularly sponsors senior GOP
officials along with Paraguayan Congressmen and military
officers on trips to Taiwan. There have been suggestions
that Taiwan has provided the ruling Colorado Party funds to
support its electoral campaigns.

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3. (C) Taiwan is intensely concerned Paraguay might tilt
away from Taiwan and toward the PRC. Paraguay is under
pressure from its Mercosur partners -- namely Argentina and
Brazil -- to open relations with the PRC as a prerequisite to
negotiation of a Mercosur trade agreement with the PRC.
Diogenes Martinez, a former Paraguayan FM, heads up the
Paraguayan Association of Friends of the PRC (APACHI); made
up of retired military and political officials, APACHI
advocates Paraguay's establishing relations with the PRC.
Earlier this year, a Colorado Senator drafted a bill that
called for Paraguay to allow the PRC to open an economic
trade office based on the benefits in trade Paraguay could
expect in return. The bill went nowhere at the time but
there has been some talk of its introduction for formal
consideration by the Senate. The Taiwanese Embassy strongly
objects to establishment of this office. However, it has not
been lost on supporters of this bill that other States that
recognize Taiwan -- i.e. Panama -- have allowed the PRC to
open up a trade office and continue to receive assistance
from Taiwan.

4. (S) The Taiwanese Ambassador is openly critical of the
PRC's alleged intentions and actions. The Taiwanese PolCouns
has suggested the PRC is not above buying the support of key
politicians as well as APACHI leadership. (Comment: Of
course, the same charge has been levied against Taiwan. End
Comment.) Post has no basis to assess bonafides of
allegations by Taiwanese representatives about PRC actions
and plans but believes enhanced dialogue could produce more
insight into PRC activities.
KEANE

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