Editorial: Don't waste money on lost causes

田弘茂) has abandoned President Chen Shui-bian's (陳水扁) delegation visiting Latin America and rushed to Macedonia to try to salvage diplomatic relations with Skopje, which appears to be on the verge of establishing ties with Beijing. Such situations are by no means new to Taiwan's foreign ministers, who have developed a set of contingency measures to deal with them. Basically, those measures involve offering more aid in return for a policy reversal. But this "money diplomacy" strategy appears to be losing its effectiveness in the face of stiff competition from Beijing.

Macedonia was viewed by many as an important foothold for Taiwan in terms of making diplomatic inroads into Europe. But the relationship was fraught with troubles from the very beginning. Macedonia has been and continues to be threatened by civil war and political factionalism. Some of those factions wanted diplomatic ties with Taiwan. Others felt Skopje should retain its links to Beijing. That lack of consensus has meant that Peter Cheng (鄭博久), Taiwan's ambassador to Macedonia, has never been able to present his credentials.

Political instability has also hindered Taiwan's economic aid programs, souring Macedonian expectations of benefits from ties with Taipei. Also, to punish Skopje for teaming up with Taiwan, Beijing has used its veto power in the UN Security Council to block the extension of the mandate for UN peacekeeping forces in Macedonia despite majority support for it. Macedonia has apparently caved in to Beijing's carrot and stick strategy, as the president has sent a special envoy to China to discuss resuming diplomatic ties. But Macedonia's prime minister has continued to reassure Taiwan that ties will remain stable. Who should be believed?

Similarly, during Chen's visit to Panama, President Mireya Moscoso reassured him that diplomatic ties are stable. But her remarks were followed immediately by the country's foreign minister telling reporters that he would be happy to see the establishment of diplomatic ties with Beijing. Panama's second vice-president Kayser Basan also openly called on Taiwan to increase investments and imports in return for Panama's diplomatic support.

Beijing has gained considerable economic influence over Panama ever since the Panama Canal was returned to the Panamanian government in 1999 and Hutchinson Whampoa (黃埔和記), a company owned by Hong Kong's pro-Beijing tycoon Li Ka-shing (李嘉誠), acquired the rights to run the canal ports. For several years, Panamanian delegates to the UN have not backed Taiwan's UN membership bid -- a sign that the country may be wavering in its allegiances.

After retreating to Taiwan in 1949, the ROC government kept its seat in the UN Security Council. But the scales tipped in Beijing's favor after China replaced Taiwan in the UN in 1971 -- following Chiang Kai-shek's (蔣介石) short-sighted refusal to accept a dual representation system. Since then, Taiwan has had to rely on its economic prowess to expand its diplomatic arena. But China's economy has also taken off over the past 10 years, giving Beijing the money it needs to undermine Taiwan's diplomatic efforts.

The diplomatic struggle between the two sides of the Strait has now become an economic war of attrition. Taiwan's unique diplomatic position has made money diplomacy a necessary strategy. But the global economic slowdown has also had a bigger impact on Taiwan's economy than China's, putting Taipei in an even more disadvantageous position.

For Chen, the economic slowdown and dwindling foreign aid programs should drive home the importance of economic power -- Taiwan's status, security and diplomacy all depend on it. After returning from his tour, Chen should put all his efforts into strengthening Taiwan's economy. Only this will be the key to safeguarding Taiwan's foundations.