The Republic of China (Taiwan) faces a growing challenge as the number of countries that extend it formal diplomatic recognition continues to shrink. In the past, Taiwan was able to expend substantial amounts of money in competition with China for global diplomatic recognition. Today, however, as China has grown richer and more influential, Taipei has to spend smarter and tailor its giving more strategically if it wants to continue to leverage development assistance as an incentive for countries to refrain from swapping recognition of Beijing in exchange for economic rewards.

How can Taiwan optimize its development assistance to Latin America and the Caribbean to ensure that it gets the maximum diplomatic value out of its generosity? What aid programs does Taiwan currently undertake in the region, and what does it get from its efforts? How does Taiwan's assistance fit with U.S. policy goals and giving in the region? Are there areas where adjustments could be made that would produce synergies between Taiwan and U.S. efforts while also reducing the temptation on the part of regional governments to de-recognize Taipei and switch ties to Beijing?

This report explores these questions and finds that, on the whole, Taiwan's assistance to the governments of Latin America and the Caribbean is well-received, improving desired outcomes such as enhancing local livelihoods and contributing to greater resilience and more rapid disaster recovery and relief.