54 Time February 15/February 22, 2021
When Alex AlmeidA surveys his fAmily fArm in A rurAl
corner of landlocked Paraguay, he sees mainly fields, punctu-
ated by small houses with sheet-metal roofs and, in the distance,
native lapacho trees blooming with bright yellow flowers. But
despite the isolation, there’s only one place in the world the
23-year-old feels truly cut off from. Paraguayan exports of cows
and sheep, like the 130 or so Almeida raises, are locked out of
the second largest economy in the world, a source of frustra-
tion for an ambitious young farmer and student of agriculture.
“The cell phone I’m speaking to you on now is from China,” he
tells TIME from Caaguazú, a town some 100 miles east of the
capital, Asunción. “The shoes and clothes that I buy and wear,
it all comes from China. So why can’t we export food to China?”
The answer is that Paraguay is one of only 15 countries in the
world—including nine in Latin America and the Caribbean—
that still don’t recognize the government in Beijing. In 1957,
Paraguay’s recently installed right-wing dictator Alfredo
Stroessner recognized Taiwan—an island that politically split
from the mainland following China’s 1945–49 civil war, but
which Beijing considers a breakaway province—as the “one
true China.” In response, China limits trade and diplomacy with
Paraguay, just as it does with any country that recognizes Tai-
wan. “It’s a political thing, and for many of us it’s absurd, really,”
Almeida says. “Taiwan helps us a lot, sending donations and fi-
nancing, but it doesn’t serve us at a great scale.”
In April 2020, as COVID-19 began to tear through Latin
America, the leftist bloc in the Paraguayan Senate introduced
a bill to open relations with Beijing—which would inevitably
mean ending recognition of Taiwan. The Senators argued that
the pandemic would make Chinese support—in the form of
masks and ventilators, but also investment, trade and possi-
bly a vaccine—crucial in the coming years. In the end, the pro-
posal was voted down, 25 to 16, in a Senate still controlled by
the right-wing party Stroessner founded. Still, opposition law-
makers have forged ahead in deepening their institutional ties
with China, eliciting what they described as the first-ever Chi-
nese humanitarian aid to Paraguay in June, and vowing to rec-
ognize the country if the balance of power in Congress shifts.
The political debate in Paraguay reflects a broader bat-
tle raging across Latin America about China’s swelling influ-
ence. As countries in the region grapple with a cascade of chal-
lenges to their developing economies, they increasingly look
not to the North but to the East. Today, China is South Ameri-
ca’s top trading partner. In 2019, Chinese companies invested
$12.8 billion in Latin America, up 16.5% from 2018, concentrat-
ing on regional infrastructure such as ports, roads, dams and
railways. Chinese purchases of miner-
als and agricultural commodities helped
South America stave off the worst priva-
tions of the 2008 financial crisis.
And during COVID-19, Latin America
is once again reliant on China, whose mid-
dle class drives demand for beef from Uru-
guay, copper from Chile, oil from Colom-
bia and soya from Brazil. These are the
commodities that will help Latin Amer-
ica weather the storm—and China will in-
evitably be the primary customer. “We’d
rather not be so dependent on exports to
China, but what is the alternative?” Paulo
Estivallet, Brazil’s ambassador to China,
tells TIME. “It’s just more profitable to
sell here than anywhere else.”
For China, the investment brings polit-
ical returns. In the past four years, the Do-
minican Republic, El Salvador and Pan-
ama have each switched their recognition
from Taiwan to China. Gaining these