Under President Lai Ching-te, Taiwan may have paused its diplomatic freefall, but survival, not success, will shape the future of Taiwan’s diplomacy. As China intensifies pressure across Latin America through economic persuasion and media influence, Taiwan’s allies are increasingly vulnerable to diplomatic switches. Paraguay’s wavering stance, for example, demonstrates the cost of neglecting opposition outreach.
Paraguay is Taiwan’s last remaining ally in South America, having maintained ties with Taipei since 1957. For decades, both countries have shared anti-communist identities and personal ties between political elites. However, Taipei’s strategy carried a fatal flaw: it is a relationship built almost exclusively with Paraguay’s Colorado Party, thus neglecting opposition actors.
Today, that imbalance is reaching a breaking point as opposition parties such as the PLRA grow vocal about their skepticism of ties with Taiwan, proving that a diplomatic strategy that does not engage the opposition cannot survive over the long term.
China has exploited this opening. Its growing economic influence, investments in Paraguay, and role as a major indirect importer of Paraguayan soy and beef is fueling debates over Paraguay’s ties with Taiwan. Since 2019, Paraguay’s agribusiness sector has increasingly pushed for diplomatic recognition of China over Taiwan. Although Taiwan ties have been maintained thus far, the opposition PLRA has taken an increasingly close stance to China.
On October 20, 2025, an opposition-led delegation of Paraguayan legislators visited China under Beijing’s sponsorship. Most legislators present came from the opposition PLRA, while Colorado party officials did not participate amid reported regional and government pressures.
China has also strengthened its influence in Paraguay’s media landscape. Chinese Foreign Ministry Spokesperson Guo Jiakun cited a survey by Metro Market Research published in the newspaper 5Días stating that 58.3 percent of Paraguayans consider establishing diplomatic relations with China as “very important” while 29.8 percent consider it “important.” Beijing used this data to argue that Asuncion should recognize the “will of the people” and abide by the one-China principle. However, the article disappeared after publication, raising significant questions about its credibility.
Meanwhile, Taiwan is losing ground not only with the PLRA but also within the Colorado Party. Hugo Meza, vice president of the Paraguayan Chamber of Deputies and a Colorado member, has repeatedly expressed a pro-Beijing stance, stating that Paraguay is “wasting time” in Taiwan. Meza frames himself as “pro-Paraguay” and “neither pro-China nor pro-Taiwan.” Meza’s stance should concern Taipei, as it suggests that China’s message is resonating across party lines – and signals an erosion of the once strong consensus on Taiwan within the Colorado Party.
As competition for diplomatic support grows, both China and Taiwan have intensified efforts to bring legislators from Paraguay and other allies on official visits. China emphasizes economic development opportunities as its standard pitch in countries without formal diplomatic ties, while Taiwan focuses on strengthening cooperation through partnerships.
Yet China’s economic appeal remains stronger for many Paraguayan stakeholders, especially the PLRA, business actors, and the agricultural sector. Taiwan’s ambassador to Paraguay, José Han, has argued that Beijing’s propositions are not “genuine” but merely attempts to undermine relations between Paraguay and Taiwan. Other countries in Latin America that switched recognition from Taipei to Beijing have often been disappointed by the limited benefits that followed. Regardless, the perception of greater potential economic benefits from China continues to shape Paraguay’s political debates.
These shifts in sentiment demonstrate that Taiwan’s historical strategy of prioritizing one political party is no longer sustainable. If the opposition wins a future election, Taiwan could lose its sole diplomatic ally in South America, and its largest ally in the entire Western Hemisphere. To mitigate this risk, Taipei should adopt a pragmatic approach by engaging with all political factions and emphasize that Taiwan’s cooperation benefits not just a specific party or sector, but Paraguay as a whole.
The Taiwan-U.S. relationship serves as a strong and reliable model for such relations. A bipartisan consensus in Washington has ensured continuous support for Taipei even after the United States switched diplomatic ties to Beijing in 1979. This bipartisanship was based on widespread agreement over the importance of Taiwan for national security concerns, shared democratic values, and a growing wariness of China’s influence. This template could assist in preventing a change of government in Paraguay from automatically leading to a diplomatic shift.
The U.S. has recently identified the Americas as the core of its new National Security Strategy. For Taiwan, this signals an opportunity to align more closely with Washington where interests intersect. Taipei can take advantage of the broad right-wing political shift in parts of the Americas, which has brought governments ranging from Bolivia to Honduras closer to the U.S. and further from China.
Paraguay, led by the Colorado Party, fits into this context. On December 15, the Colorado government signed a Status of Forces Agreement (SOFA) with the U.S. to formalize military cooperation between both countries, establishing clear rules for the presence of U.S. troops in Paraguay for training, shared security goals, and disaster response. The U.S. is also among Paraguay’s largest trading partners, with bilateral goods trade being valued at approximately $3.5 billion in 2024. This cooperation across varying issues from migration to security demonstrates that the Trump administration perceives Paraguay as a reliable partner.
However, Washington has left most of its economic leverage unused. As a major trading partner with Paraguay, it could dissuade Paraguayan politicians from supporting diplomatic ties with China by counterbalancing Beijing’s economic offers with its own. Through a formal trilateral framework between the U.S., Paraguay, and Taiwan, Washington could explicitly link market access, supply chain partnerships, and investment tools between the three countries in a way that would be more beneficial to Paraguay economically and sovereignty-wise than relying on China’s aid, trade, and economic investment.
To bolster democratic values and influence in the Americas, the U.S. should support Taiwan in the recalibration of its ties with Paraguay by encouraging a more institutional, bipartisan approach that would normalize Taipei as a credible cross-party democratic ally. Joint efforts could help institutionalize multi-party engagement, broaden outreach beyond elites, and increase visibility of Taiwan’s development programs at the grassroots level. As Beijing continues to quietly lay the groundwork for future diplomatic shifts in the Americas, now is the time for Washington and Taipei to align their policies.
