Author: Loro Horta.

Guinea-Bissau shocked China in 1990, when it gave diplomatic recognition to Taipei after 26 years of diplomatic relations with the People’s Republic. The switch was particularly resented because Beijing had been one of Guinea-Bissau’s most enthusiastic supporters in its 12 year struggle for independence from Portugal. The Chinese had trained many of Guinea-Bissau’s guerrilla leaders, including the president at the time, Joao Bernardo “Nino” Viera, and had provided extensive diplomatic support. The fact that the party in power when the switch took place was the PAIGC (Party for the Independence of Guinea and Cape Verde), which had been founded on Marxist-Leninist principles and for decades had close party relations with the Chinese Communist Party, further enraged Beijing. But with the Cold War over and the western countries seemingly dominant, the PAIGC, like other Marxist-oriented parties, was liberalizing the economy and moving toward multi-party elections. Taipei saw its opportunity and offered Guinea-Bissau’s leaders a deal they chose not to refuse. It took Beijing years to get its “old friend” back into fold, but in 1998 the Bissau government ditched Taiwan and restored full diplomatic ties with the PRC. Since then, the PRC has decided not to take any more chances with Guinea-Bissau and has steadily expanded its presence in the country – despite the fact that China has hardly any immediate economic interests at stake. China’s initial objective is to engage Guinea-Bissau to the furthest extent possible in order to minimize the possibility of a Taiwanese return. Beijing aims at completely eradicating the Taiwanese influence, and particularly any diplomatic or political presence, from the Portuguese speaking world. This is consistent with China’s overall policy of isolating Taiwan to the further extent possible. Over the longer term, China may gain access to important oil reserves, if Guinea-Bissau’s hopes for major discoveries pan out. Restoring ties with Guinea-Bissau was an important win for China, and in the years since, the PRC has intensified its efforts to isolate Taiwan worldwide, targeting Taipei’s most committed and long-time supporters, such as the central America sates who had been loyal to Taiwan for decades. In June 2007, Costa Rica, after 58 years of relations with Taiwan, finally abandoned its old friend and established diplomatic ties with China. In the Portuguese-speaking world, China has succeeded in isolating Taiwan from all but one of the eight of members of the Cumunidade dos Paises de Lingua Portuguesa (CPLP, Community of Portuguese-Speaking Countries), and judging by Beijing’s continuous efforts in relation to Africa’s tiny Sao Tome and Principe, it may be just a matter of time before Taiwan is completely pushed out of the lusophone world. In order to prevent a return of Taiwan to Guinea-Bissau, and to preserve its hard-won victory there, China has launched a major aid effort in the country. At the same time, it is emphasizing that its “sincere and friendly help” will be a long term commitment. This approach should assure that Taipei does not stage a comeback through its “check book diplomacy.” In November 2006, China announced it was going to fund the construction of a massive dam in Guinea-Bissau, 200 kilometers from the capital Bissau at a cost of $60 million. The Ceba River dam, the first such structure in the country, will be vital to sustaining Guinea-Bissau’s agriculture-based economy and meeting its future energy needs. Other major infrastructure projects include a deep water port in Buba, to be the country’s largest such facility, the rehabilitation of Guinea-Bissau’s two main highways, and the construction of a bridge over the Farin River. As in other African countries, the PRC has also funded very visible and symbolic buildings that greatly contribute to enhancing its prestige and visibility as a major player. Under its ajuda amigavel e gratuita (free and friendly help) assistance program, China has offered to build the national parliament building, rehabilitate the presidential palace that was damaged during the 1998 civil war, and construct a six-story central government building, the largest project in the capital. Beijing is also putting up a 1000-unit public housing project. In August 2007, funding was announced for additional construction, including a justice palace and the rehabilitation of schools and health facilities. Other assistance includes the provision of 100 scholarships for local students to attend Chinese universities, and $400,000 in humanitarian assistance to the northern areas of the country along the border with Senegal, where a significant refugee problem still remains as a result of the civil war. A 2,000 ton gift of Chinese rice was much welcomed in view of the exorbitant price of the staple crop in the local market. It allowed the regime to address the most basic immediate needs of the population while buying vital time for further shipments to arrive. This Chinese gesture may have prevented serious civil unrest, and it certainly enhanced China’s image in the eyes of the government and people. In August 2007, this first rice shipment was followed by an even larger one of 30,000 tons. To help stimulate Guinea-Bissau’s economy, China has exempted 442 of its products from Chinese tariffs. Beijing has provided funds for direct budget assistance to Guinea-Bissau, including a $4 million donation to assist the government in paying delayed salaries to its civil servants and $1.2 million donation to help the country host the CPLP heads of state summit in Bissau in July 2005. China has also assisted Bissau with some of its diplomatic representation expenses in Beijing by providing its diplomatic mission with vehicles and office equipment. Large numbers of public servants and some military officers are expected to head to the PRC for training, and the numbers of Chinese assistance personnel in Guinea-Bissau are expected to increase, particularly in the areas of agriculture, health and fisheries. The health sector is another area where China has provided useful and much needed assistance. In addition to sending medical teams, a crucial gesture considering the country’s limited numbers of doctors, the PRC has given medical supplies and equipment. China’s main health project is the rehabilitation of the Canchungo regional hospital, 70 kilometers from the capital, at a cost of $3.5 million. In 2006, Guinea-Bissau become the first country to sign a deep water fisheries agreement with China, opening the door for large numbers of Chinese fishing vessels to operate in its Exclusive Economic Zone (EEZ). Currently there are at least six Chinese vessels working offshore, including two large freezer ships. The fisheries agreement has raised some concerns among environmentalists due to the unique nature of the country’s coastal ecosystem. The region of greatest concern is the Bijagos archipelago, which UNESCO has declared a Biosphere Ecology Reserve.. Environmentalists worry that the Guinea-Bissau navy will be unable to monitor the large numbers of Chinese fishing vessels expected to be eventually deployed. Currently the country possesses just two patrol boats at an uncertain state of operational readiness to cover a 350 kilometer coastal area with 80 islands and reefs. In order to dispel concerns, China has offered to assist the country’s navy by providing patrol vessels, communication equipment, and training. Other defense-related assistance includes the rehabilitation of the main military hospital, the construction of a residential area for military officers, and the repair of various military installations damaged during the civil war. However, it is the oil sector that seems to be of greatest interest for both China and Guinea-Bissau. Since the last years of Portuguese colonization, there have been numerous reports of significant oil reserves along the coast. In the 1960s and 1970s, various French and American oil companies were reported to have approach the Portuguese government for oil concessions. However, the fascist and isolationist Portuguese government of the day, with economic policies that had made Portugal the poorest nation in Western Europe, resisted such moves. Today, Chinese experts are expected to start major seismic studies and other tests shortly to fully assess the true potential of the reported oil reserves. Like the deep fisheries agreement, the oil exploration plans have raised environmental concerns, and there are fears that some of the areas where reserves may be located are too close to the Bijagos. If significant oil reserves are indeed found in or near the Bijagos, will an impoverished Guinea-Bissau be able to resist the temptation to drill? Or will it choose to protect its environment and one of he world’s natural treasures? This remains to be seen. While most Chinese investment in Guinea-Bissau is through enterprises linked to the Chinese government, some major Chinese private investors are beginning to take notice of the country’s potential. Macao casino tycoon Stanley Ho has invested in a casino on Caravela Island in the Bijagos archipelago. One may wonder about the wisdom of building a casino in a UNESCO-protected area and about the benefits of building casinos generally in one of the world’s poorest nations. Another major investment by Ho was the purchase of a 60% stake in Guinea-Bissau’s only viable bank, the Banco da Africa Ocidental (BAO). It is perhaps worth noting that Beijing’s increasing commitment in Guinea-Bissau comes at a time when the United States has significantly reduced its presence. The State Department describes U.S.-Guinea-Bissau relations as “excellent,” but the U.S. embassy was closed in 1998 during the civil war and has not reopened. Guinea-Bissau has no embassy in Washington. The mutual lack of official representation in the two capitals is regrettable, particularly in view of the growing importance of Guinea-Bissau as a transit point for the narcotics trade from Latin America to Europe. The issue may well become a source of contention between Washington the European Union (EU) on the one hand, and Bissau on the other. Some observers have argued that Guinea-Bissau can now be described as a narcostate, with officials at the highest levels believed to be involved in the illicit drug trade. This fact has been admitted by the Bissau government itself, with the minister of interior acknowledging that senior military officers have participated in the trade. However, this acknowledgement may represent just the tip of the iceberg, since many observers believe that high officials beyond the military are also involved. If both Washington and the EU put pressure on Guinea-Bissau to stop the narcotics flow into Europe and beyond, as seems likely, what will be the impact on the country’s relations with the PRC? Beijing seems to be very aware of the endemic narcotics problem facing Bissau and believes it to be a manageable risk that will not affect its overall objectives. China is most likely to adopt its usual line that it does not interfere in the domestic affairs of other counties and continue business as usual, just as in the case of Burma. When asked to comment on a hypothetical situation in which the United States and the EU imposed sanctions on Bissau over its failure to curtail the drug trade, a Chinese ministry of foreign affairs official said: "Sanctions don’t solve anything, the drug problem results from poverty so economic development is the answer. Therefore, we should help the country in that area, that’s what China is doing. Sanctions will only make matters worse" Beijing seems to have adopted a long term commitment towards Guinea-Bissau, and is likely to conclude that whatever Washington and the Europeans may do, maintaining and expanding this commitment is a risk worth taking. While close ties with a suspected narcostate may create some international embarrassment for the PRC, it is very unlikely that Beijing will reconsider its policy. After all, as the Burma case suggests, Guinea-Bissau is not the first narcostate to be a close friend of Beijing. Nonetheless, China could pressure Guinea-Bissau officials to move against the drug trade if it becomes too much of an international issue. There is evidence that China has supported drug eradication efforts in Burma – though most likely because narcotics from that country were a threat to China itself. The fact that Beijing is taking great risks in its dealings with Guinea-Bissau when others are shying away may pay handsome dividends in the future, particularly in the oil sector. Major oil deposits may not be found, and cordial relations with a regime that may be tied to the international narcotics trade could one day prove a liability in world opinion. But for now China seems to feel that these are risks worth taking. So far, China’s assistance to Guinea-Bissau seems to have significantly enhanced its prestige inside Guinea-Bissau and to have won gratitude from the government and the people at large. When asked to comment of his country’s new relationship with the PRC during a visit to China earlier in 2007, President Nino Viera, back in power after a comeback in 2005 elections, said: “China is a very good and sincere friend of Guinea-Bissau, it listens to us when others don’t.” How long the honeymoon will last this time around remains to be seen. ______________________________________________________________________ Loro Horta is a research associate fellow and Ph.D. candidate at the S. Rajaratnam School of International Studies (RSIS), Nanyang Technological University, Singapore. He is also a graduate of the National Defense University of the Peoples Liberation Army (PLANDU) in Beijing. The Online Africa Policy Forum is produced by the Center for Strategic and International Studies (CSIS), a private, tax-exempt institution focusing on international public policy issues. Its research is nonpartisan and nonproprietary. CSIS does not take specific policy positions. Accordingly, all views, positions, and conclusions expressed in this publication should be understood to be solely those of the author(s).