TAIPEI (Taiwan News) — China reportedly offered Nauru US$100 million (NT3.14 billion) to drop diplomatic ties with Taiwan in favor of Beijing, while a Tuvalu ambassador warned that China is much less transparent than Taiwan when it comes to foreign aid.

On Monday (Jan. 15), Nauru announced that it was severing diplomatic relations with Taiwan and the Ministry of Foreign Affairs (MOFA) responded by also terminating diplomatic relations with the Pacific island country. Deputy Foreign Minister Tien Chung-kwang (田中光) said MOFA obtained intelligence in 2023 that China had engaged with Nauru’s political leaders and offered economic incentives to get the country to change recognition.

Despite efforts to engage in bilateral cooperation projects, Nauru continued to seek substantial economic assistance from Taiwan and compared it with the aid proposals from China. Regarding the amount China offered Nauru, Tien said that he was not at liberty to disclose the exact figure but said it "far exceeds the amount of aid we provide to our diplomatic allies."

A source told CNA Nauru requested massive financial assistance from Taiwan to compensate for the large financial gap resulting from Australia’s closure of the Nauru Regional Processing Centre and funding for hosting sporting events. The refugee center alone incurred an annual expenditure of approximately NT$2.6 billion, constituting over half of Nauru's annual budget.

A senior Taiwanese official told Reuters China offered Nauru US$100 million in annual economic assistance to switch diplomatic relations from Taipei to Beijing. A Nauru spokesperson declined to comment when questioned by Reuters over the matter.

Taiwan now has only 12 diplomatic allies. Among these nations, Tuvalu's ambassador to Taiwan, Bikenibeu Paeniu, told the Guardian that he was shocked by Nauru's decision.

Paeniu said, "It’s really surprising and sad, especially to me and the people of Tuvalu." He added, "We know what China is doing, it’s going around selling itself to countries in the Pacific."

However, he warned that in comparison with Taiwan, the aid China is proposing to poor countries is "not transparent." Paeniu said that this move is concerning as his country is grappling with the effects of global warming and "Taiwan is very serious" when it comes to assisting the country cope with climate change.

Paeniu said he had hoped that Taiwan's four remaining Pacific island allies had remained united, but "now we are going to lose Nauru."