China has established diplomatic ties with Panama, a move that has further constricted Taiwan's international space. The two countries' foreign ministers yesterday signed documents formalising ties at the ambassadorial level, leaving Taiwan with just 20 diplomatic allies.

Panama recognises "there is only one China in the world, and that the government of the People's Republic of China is the sole, legitimate government representing the whole of China, and that Taiwan is an inalienable part of China's territory", said Chinese Foreign Minister Wang Yi after the signing in Beijing with his Panama counterpart, Ms Isabel Saint Malo.

Panama's breaking of ties with Taiwan represents "an irresistible trend", said a spokesman for China's Taiwan Affairs Office, suggesting that more of the island's allies might follow suit.

Analysts said Beijing has intensified efforts to reduce Taiwan's international space since the election of President Tsai Ing-wen and her pro- independence Democratic Progressive Party last year. She has not acknowledged the 1992 Consensus - a tacit agreement between both sides that there is only one China - and cross-strait ties have deteriorated.

The hawkish Global Times yesterday said the loss of a key ally like Panama is "the price to pay" for not recognising the 1992 Consensus. "Tsai Ing-wen's government must now be in a panic, worried that its other Central American 'diplomatic relations' will learn from Panama and cause a domino effect," it said.

Taiwan's Foreign Ministry accused Panama of bullying it and ignoring years of friendship, and said it will "not compete with Beijing in money diplomacy".

Panama's decision followed a move by the African island nation of Sao Tome and Principe to break off ties with Taiwan last December.

Most of the 20 countries that maintain diplomatic ties with Taiwan are in Latin America or the Pacific, regions without strong economic ties with China. But even these countries can no longer ignore China's global economic clout and influence, said experts.

"China is today not only the world's growth engine, but a key player in safeguarding the international order," said cross-strait expert Zhu Songling. "This is not a case of China being a bully, but reflects Taiwan's declining influence on the world stage as a result of wrong-headed policies," said Dr Zhu of Beijing Union University.

Dr Wang Weinan of the Shanghai Academy of Social Sciences said Panama had long been making overtures to Beijing. But Beijing said no to maintain the peaceful development of cross-strait ties under then President Ma Ying-jeou, he said.

A US cable released by WikiLeaks in 2011 said Panama tried to switch allegiance in 2009 from Taiwan to Beijing, but was rebuffed by China.

Dr Wang said China is likely to "calibrate the pace" of poaching. "If Taiwan were to lose all its allies at once, that would have too great an impact on the Taiwanese population... But if Ms Tsai persists on the path of Taiwan independence, then its diplomatic space is likely to shrink further."

Shrinking list of allies

EAST ASIA AND PACIFIC

• Kiribati

• Nauru

• Republic of the Marshall Islands

• Solomon Islands

• Republic of Palau

• Tuvalu

AFRICA

• Burkina Faso

• Kingdom of Swaziland

EUROPE

• Holy See

LATIN AMERICA AND CARIBBEAN

• Belize

• El Salvador

• Haiti

• Nicaragua

• Paraguay

• Dominican Republic

• Republic of Guatemala

• Republic of Honduras

• The Federation of Saint Christopher and Nevis

• Saint Lucia

• Saint Vincent and the Grenadines

OTHER RECENT DEPARTURES

• December 2016: Sao Tome and Principe sever ties with Taiwan, acknowledging China's "increasingly important" international role.

• March 2016: Beijing says it is resuming ties with Gambia, three years after the latter broke off relations with Taiwan.

SOURCES: HTTP://WWW.MOFA.GOV.-TW, AGENCE FRANCE-PRESSE