US trying to counter Chinese overtures to Paraguay, document suggests

A document allegedly from the US embassy in Paraguay, outlining plans to influence President Santiago Pena and counter “strategic corruption”, suggests that Washington is trying to curb China’s increasing diplomatic presence in the country.

The 13-page document, called “Paraguay Interagency Integrated Anti-Corruption Action Plan”, was allegedly sent by the embassy in Asuncion to the White House on July 27, three months after Peña won the country’s presidential election.

First reported by the Argentine newspaper La Politica Online, the plan cites the political sway of Horacio Cartes, Paraguay’s former president and a key mentor to Pena, highlighting their relationship as a potential threat to US influence in the region.

After the Paraguayan elections, it reads, Beijing might refocus its efforts on Paraguay, making Cartes’ involvement with corruption schemes “an emerging threat and one with importance to our broader position in South America”.

Paraguay is the sole South American country holding diplomatic relations with Taiwan rather than mainland China. During his campaign, Pena pledged to maintain relations with Taiwan.

In a news conference, US Ambassador Marc Ostfield neither confirmed nor denied the authenticity of the plan. Ostfield added that Washington remained committed to “supporting Paraguayan institutions in combating corruption and impunity”.

The US has imposed sanctions on Cartes for reportedly achieving political gains through corrupt practices, including bribing several Paraguayan politicians during his successful 2013 presidential campaign.

The document suggests continuing efforts to enhance cooperation with Paraguay and stave off Beijing’s bid for formal diplomatic channels with Asuncion.

In Paraguay, Taiwan ties weighed against China’s potential economic role

The Paraguayan cattle industry has been hit hard by export restrictions to Russia following the Ukraine conflict, and Paraguayan beef producers have urged President Peña to reconsider the country’s diplomatic allegiance to Taiwan, hoping for better trade prospects with mainland China.

Sources said that the Asociacion Rural del Paraguay, an agribusiness lobbying group, has analysed how closer ties with China have benefited farmers in Brazil and Peru. The group plans to present their findings to Pena, aiming to sway him more toward Beijing.

A US Department of Agriculture unit – the Animal and Plant Health Inspection Service – has suggested re-evaluating an existing US ban on Paraguayan beef imports, which had been imposed due to concerns about foot-and-mouth disease.

Stating that “fresh beef can be safely imported from Paraguay” under specific conditions, the proposal could offer Paraguay an alternative market, reducing domestic pressure on Peña and slowing any Paraguayan diplomatic rapprochement with Beijing.

Taiwan’s dwindling relationships with Latin American countries was raised during a hearing at the US House Foreign Affairs Committee on Thursday.

Discussing “China’s malignant influence in Latin America”, Representative Maria Elvira Salazar, a Florida Republican who led the hearing, questioned a State Department official, Kerri Hannan, about what initiatives the Biden administration was undertaking to ensure that seven nations in the region maintain their relations with Taiwan.

Hannan did not directly respond, saying only that the US was promoting to “public and private partners in the region” the benefits of the relationship with Taiwan.