Analysis: China and the Vatican – What if the US recognizes Taiwan?

Washington, D.C. Newsroom, Sep 17, 2020 / 12:45 pm (CNA).- Officials in Rome and Beijing are now confidently predicting an extension to the 2018 Vatican-China deal, despite continued persecution of Catholics in the country and little visible progress on the appointment of bishops.

The Vatican-China agreement continues to be viewed by many as a bad deal for the Holy See. Rome appears to have little leverage in the talks, and few cards to play. While the U.S. has made clear its own bleak assessment of the situation, there is one dramatic diplomatic maneuver from the Trump administration that could strengthen Rome’s hand, and rebalance the relationship between all three powers.

The pivot point for such a move is Taiwan. And it may be under consideration.

Sources tell CNA that some in the White House, and in foreign policy conversations, believe Trump might be considering strengthening official diplomatic relations with Taiwan before the election, a path already begun with a 2018 act of Congress and the signing of a 2019 consular agreement. Taking more steps toward full recognition and relations with Taiwan would have far-reaching global effect, and could have considerable impact on the Vatican-China deal.

The Republic of China, as Taiwan is formally known, is the one of China’s foremost domestic and foriegn policy priorities. Seen by Beijing as a rebel province, despite never having been under Communist control, diplomatically isolating the small island democracy has been a constant priority for the mainland.

For decades, China has pressured the United Nations and other member states to de-recognize Taiwan and recognize the People’s Republic as the “only” China. Today, only a handful of nations have diplomatic ties with Taiwan, with those few now falling away under economic pressure by China.

The Holy See is the last remaining European country to recognize Taiwan, and the heart of Vatican-China relations remains working towards one unified Catholic Church in China, with the Vatican adopting Beijing’s “one China” diplomatic policy. The signs are that this may be happening.

In recent months, as the Holy See and China have negotiated an extension of the 2018 agreement, Vatican support for Taiwan has been noticeably quiet. Amid the COVID-19 pandemic, the Holy See was the only diplomatic ally of Taiwan which did not make an appeal to allow Taiwan to participate in the World Health Organization’s assembly meetings. Taiwan’s Ministry of Foreign Affairs said in May that the Vatican would voice its support for Taiwan through other channels.

But in July, the Hong Kong newspaper South China Morning Post quoted a Vatican source saying that “Taiwan should not be offended if the embassy in Taipei is moved back to its original address in Beijing.”

This week, Taiwan’s foreign ministry said that it had received assurances from the Vatican that the renewal of the Vatican-China deal would not have formal diplomatic repercussions for Taiwan. This is likely true, for now, but unlikely to be because of any diplomatic commitment by the Secretariat of State to Taiwan.

The most likely reason Rome will decline to break formally with Taipei in favor of Beijing, at least for now, is that it remains one of the strongest cards it has to play in driving for a deal that might secure real freedom for the Church in China, where Xi Jinping’s campaign for the Sinicization of religion continues to impose draconian measures on Catholics.

The Vatican’s willingness to play that card, and Xi’s willingness to offer something real in return, could change dramatically if President Trump took more steps towards full recognition of Taiwan – something at once diplomatically unthinkable, and entirely plausible.

This week, the Trump administration heralded new diplomatic progress in gaining the recognition of Israel by Arab nations. The most recent announcement, that the United Arab Emirates and Bahrain would assume full diplomatic ties with Israel, is the latest in a series of unlikely coups for U.S. diplomacy in the region, following the dramatic decision to move the U.S. embassy from Tel Aviv to Jerusalem.

When Trump announced his intention to move the U.S. embassy, many observers predicted it would provoke outrage and backlash from the Arab world, and harm prospects for peace in the region. So far, the reverse seems to have proven the case – to the surprise of many.

The administration continues to pursue aggressive trade policies with China, and has made clear its displeasure with Chinese opacity during the early stages of the coronavirus pandemic. At the same time, China has pursued a genocidal campaign against the Uyghurs internally, while driving an aggressive foreign policy – staging increasingly bellicose claims to international waters and even sailing warships into western ports unannounced – largely without international repercussions.

But Trump has been signalling movement toward a “two Chinas” policy. In August, HHS Secretary Alex Azar met with Taiwan’s president in Taipei, the first U.S. cabinet official to visit Taiwan since diplomatic ties were broken 1979. This week, the U.S. sent a state department official to attend a memorial service for a Taiwanese official.

If Trump continues down this path in weeks to come, and encourages other countries to follow suit, much as he did with Israel, the predictions would likely be dire. Many would forecast an immediate worsening of relations with Beijing and a slew of cyber attacks on U.S. agencies and companies. But Trump might also find willing allies in countries recently subject to intimidating and retaliatory behavior by China, like Australia and India.

From Rome’s point of view, American recognition of Taiwan would reset the playing field between the Church and Beijing.

In the first place, China would suddenly have a much greater incentive to keep the Vatican at the negotiating table.

Thus far, Pope Francis has remained on the sidelines regarding China’s treatment of the Church on the mainland, its network of concentration camps in Xinjiang province, and its crackdown on civil liberties in Hong Kong, letting regional leaders like Cardinal Joseph Zen and Cardinal Maung Bo talk tough over the Roman silence. But faced with a concerted international campaign recognizing a free and democratic Taiwan and isolating Beijing, keeping the pope quiet could suddenly become a much more urgent goal for China.

Conversely, American recognition of Taiwan would free up Rome’s hand and bring China to the negotiating table in earnest.

In the face of a concerted push by America to isolate Beijing, China could actually be more incentivized than ever to open formal diplomatic relations with the Holy See, and consider making actual concessions on issues like religious freedom within the country.

While observers might assume that Xi Jinping considers Vatican relations a sideshow, if he actually considers them at all, the Vatican deal might matter for Xi’s political future.

Although his tenure in leadership is supposed to be life-long, in China Xi’s position is not considered nearly as secure as is widely assumed in the West.

The full effects of the coronavirus in China may not have been reported in official statistics, but they have been severe and deeply traumatic. The economic consequences of the pandemic for China have also been – at least by some estimates – as severe as anywhere, if not worse. Intense summer flooding, even to the point of visible strain on the Three Gorges Dam, have also taken thousands of lives and devastated essential industrial areas.

Xi’s internal crackdown on dissent and free expression, most visible in Hong Kong but actually more widespread, has not been accepted easily. And sources in China report widespread unease with Xi’s antagonist foreign policies, including his courting conflict along the Indian border while also trying to stake claims to international waters in the South China Sea.

It is not an uncommon opinion in China – albeit one not commonly expressed – that, with a growing sense he’s overplaying his hand at home and abroad, Xi could face a more-or-less serious challenge to his position during the next meeting of the communist party’s National Congress.

In this context, even a threatened American recognition of Taiwan could leave Xi scrambling for diplomatic victories, and reassessing the risks of provoking a Church which he considers a potentially systemic ideological threat. The Vatican’s insistently modest requests for the barest measure of progress may suddenly appear a price well worth paying for a small victory.

For the U.S, strengthening the Church’s ability to negotiate with China, and winning even the narrowest breathing space for Chinese Catholics, would likely do more to advance civil liberties in China then decades of free trade.

Such a change to the diplomatic order may appear wildly improbable. But there is a U.S. Under Secretary of State in Taipei right now for a memorial service. And Trump, who is known for doing the unexpected, holds the only cards that will decide what happens next.

In diplomacy there is always a crucial distinction between the unlikely and the impossible.