China reasserts hard line on Taiwan after Panama's switch

Sign for Taiwan embassy in Panama

Sign for Taiwan embassy in Panama

Healther Nauert said the US was aware of Panama's announcement that it had ended diplomatic ties with Taiwan, and it urged "all concerned parties to engage in productive dialogue and avoid escalatory and destabilizing moves".

Separately, following the end of more than 100 years of diplomatic ties between Panama and the Republic of China, speculation was mounting as to which country might be the next one to switch its allegiance away from Taiwan to Beijing.

Octavio Vallarino, a partner of Desarrollos Bahia, a local real estate firm, said he hoped direct flights would soon be established between the two countries, and that the commercial real estate market would be bolstered by arriving Chinese firms. Of the countries that still have ties, Panama has the largest economy. NPR's Anthony Kuhn reports from Beijing that Panama "is emerging as a hub for China to ship its goods to South America, and Beijing has invested millions of dollars in infrastructure around the Panama Canal".

Taiwan condemned Beijing for "tempting" Panama to cut off relations with Taipei, saying China's continual effort to marginalize the island is provocative and endangers the stability in the region.

Its remaining allies were guarded about what the future held for their ties with Taiwan, which China considers a renegade province. Minister of Foreign Affairs David Lee called it "most unfriendly" and said that Panama had been deceitful "until the last moment", according to the Taipei Times.

Li said China appreciates Panama's recognition of the one-China policy and the establishment of diplomatic ties with China.

" China being the second world economy, our [Panama] 's opportunities to participate with companies in the maritime trade of that country will have a direct relationship in the management of shipbuilding, ports, ship fix, inspections and technology, among others", commented Fernando Solorzano, head of the Ship Registry. An official from Honduras, speaking on condition of anonymity, told the news service that the country meant to maintain ties.

"Every day, Taiwan is more isolated", he said, adding he did not expect the move to hurt Panama's ties with the United States, the top canal customer.

East Asia and Pacific: Kiribati, Nauru, Solomon Islands, Republic of the Marshall Islands, Republic of Palau, Tuvalu.

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