Greater transparency on aid needed

By James Baron  / 

Fri, Apr 12, 2019 - Page 8

Months after assuming the presidency of the Gambia in 1996, Yahya Jammeh made a bold foreign policy maneuver, cutting ties with China in favor of Taiwan. No observer of Taiwan’s diplomacy under then-president Lee Teng-hui (李登輝) would have been laboring under any misapprehension as to the motives for the switch.

The term “dollar diplomacy” had yet to gain currency as the default description for Taiwan’s approach to foreign relations, with euphemisms such as “pragmatic diplomacy” being preferred for the anything goes attitude that had really began to take hold under Lee’s predecessor, Chiang Ching-kuo (蔣經國).

Yet, semantic sleights of hand aside, Jammeh’s intentions were unambiguous. He was out for as much as he could wangle from the get-go; and when Taipei finally called time on his ever-more voracious leeching in 2013 — and then only because the temporary diplomatic truce between Taipei and Beijing under then-president Ma Ying-jeou (馬英九) was in place — Jammeh had siphoned off tens of millions of dollars in Taiwanese “development aid.”

“A financial lifeline” is how Gambian-American academic Abdoulaye Saine described Taiwan’s largesse. With a detailed account of Jammeh’s systematic looting of state coffers published by the Organized Crime and Corruption Reporting Project (OCCRP) this week, Saine’s assessment was a colossal understatement.

By the time he bolted to neighboring Equatorial Guinea in 2017, following a final feeble attempt to cling to power, Jammeh had embezzled more than US$1 billion in state funds. More than US$100 million of that plunder had come via grants and loans from Taiwan. And that is just what has been traced. The actual figure is almost certainly a lot higher.

Money earmarked for “medical cooperation” and grandiosely titled initiatives such as the President’s Empowerment of Girls Project ended up being funnelled into all manner of nefarious undertakings. In 2009, at least US$3 million was paid by the Ma administration to a Taipei-based arms supplier for weapons that Jammeh intended to ship to the government of indicted war criminal Omar al-Bashir of Sudan.

Jammeh’s purpose in supporting a regime that was committing mass atrocities against civilians in South Sudan and Darfur is unclear, but Taipei went to great lengths to ensure its hand in this sordid affair remained fully gloved.

In private correspondence obtained by the OCCRP, then-ambassador to the Gambia Richard Shih (石瑞琦) advised the office of the president that the deal would be executed in instalments in order to ensure a “low profile.” The ruse appears to have worked: A comprehensive 2014 report into the origins of weapons in Sudan by Swiss research group the Small Arms Survey turned up no trace of Taiwanese merchandise. It is possible Jammeh found another buyer. Sudan, in any case, remains one of the world’s most heavily armed countries.

The OCCRP report also unearthed details concerning the establishment of a Citibank account that appears to have been little more than a slush fund for Jammeh to dip into as he saw fit. Mega International Commercial Bank was one of several institutions to wire funds to the account, which received US$35 million between 2000 and 2001, the first year of Chen Shui-bian’s (陳水扁) presidency, and was eventually overdrawn to the tune of US$58 million. Most of the money came from Taiwan, and a large chunk ended up in the pockets of Mohamed Bazi — considered to be a key financier for Hezbollah.

The news that Taiwanese dollars found their way into the coffers of the Iran-backed Islamist group recalled Taipei’s role as a US proxy during the Iran-Contra scandal, when two payments of US$1 million were delivered to the Nicaraguan Democratic Force rebels between 1985 and 1986.

In using Taipei as a conduit, and thereby circumventing a temporary congressional veto on funding the contras, the administration of then-US president Ronald Reagan could claim its official policy of not sponsoring terrorism remained intact.

The parallels with the Sudan case are striking. With celebrities such as George Clooney drawing attention to the unfurling humanitarian crisis in Sudan just as Jammeh was proposing to offload the Taiwanese arms, this had the potential to become an extremely embarrassing situation for the Ma administration.

While the OCCRP expose stops short of asserting Taiwanese cognizance of Jammeh’s intentions, it notes that the Gambian leader had previously provided Sudan with a separate batch of weapons. At the very least, Taipei maintained a position of willful ignorance.

Shortly after assuming the presidency in 2016, Tsai Ing-wen (蔡英文) made it clear that there would be no return to the “checkbook diplomacy” of previous administrations. Since then, Taiwan has lost five of its diplomatic allies, leaving the number of states that recognize Taipei at 17.

China’s renewed assault on Taiwan’s diplomacy has obviously been the main reason for this. With the end of the diplomatic truce, which was really just a reward for Ma’s kowtowing, China is once again splashing cash on a level that Taiwan cannot match. Having learned from past mistakes, Tsai is not naive enough to fall into this trap.

The Tsai administration is also much more aware about the need for transparency in development assistance and the benefits of a move toward public diplomacy. Yet, old habits die hard, and the well has not quite run dry.

In February, the Ministry of Foreign Affairs confirmed a loan of US$100 million to Nicaragua. The nature of the announcement itself was concerning: A ministry statement acknowledged the loan only after Reuters reported that Nicaragua’s congress had formally accepted it and that the Taiwanese authorities had yet to comment on the matter.

However, the real problem was the timing and the stated purpose of the funds. Following the protests against Nicaraguan President Daniel Ortega that began in April last year and the subsequent bloody crackdown that left more than 300 people dead, Managua has requested funds for reconstruction efforts. With Ortega widely criticized for his response, Taiwan’s support has drawn attention. Furthermore, it comes on the back of a US$3 million donation to the National Nicaraguan Police Force in December last year.

Aside from the questionable ethics of helping to bolster Ortega’s government, as Juan Fernando Herrera Ramos observed in these pages last month, any new government might remember this support with resentment.

Then, again, there is the issue of transparency. Writing for Ketagalan Media in January, Mauricio Sandigo Peralta quoted former Nicaraguan congressman Eliseo Nunez, who said of the police force loan: “Even though [Taiwan] knows the money could be misused, they don’t say anything to avoid conflict.”

Attempting to assuage such concerns, a Ministry of Foreign Affairs statement insisted: “Nicaragua’s government has promised to use this loan appropriately in the aforementioned areas.”


The Nicaragua cases made headlines due to the global spotlight on the country. Elsewhere, Taiwan’s contributions receive less scrutiny. To take just one example, the details surrounding US$150 million of “investment” in Paraguay that was announced last year remain murky.

Even where a specific breakdown of expenditure is offered, there is often no way to be certain of what goes where. The situation frequently seems little better than the “amateurish spreadsheets” Jammeh provided as evidence of his expenditure.

Commenting on the need for greater transparency in this development assistance, National Taiwan University professor Chien Shiuh-shen (簡旭伸) said: “I think more alternatives will be adopted, but old tactics may still have a role on some occasions.”

The sooner those tactics fall by the wayside, the better. Taiwan needs to embrace the current trends toward transparency, public diplomacy and civil society approaches in its development assistance. Only then can we be sure our money ends up in the hands of those who need it, rather than the clutches of absconded despots.

James Baron is a freelance writer and journalist based in Taipei.