Nicaragua Terminates FTA Following Diplomatic Break with Taiwan

President Daniel Ortega (left in the photo) and his wife Rosario Murillo, the Vice President. (Photo by Reuters)

[Asia Economy Reporter Yujin Cho] Nicaragua, after recently severing diplomatic ties with Taiwan and establishing relations with China, has decided to terminate the Free Trade Agreement (FTA) with Taiwan as well.

According to the Spanish news agency EFE, the Nicaraguan Congress resolved on the 14th (local time) to abolish the FTA signed with Taiwan in 2006.

The bilateral trade volume reached $166.4 million (approximately 197.6 billion KRW) last year, marking a 220% increase since 2007, the year immediately following the FTA's implementation. Additionally, as of last year, Nicaragua's exports ($143.5 million) to Taiwan exceeded its imports ($22.8 million).

The Nicaraguan regime cut diplomatic relations with Taiwan and established ties with China on the 10th. Foreign media analyzed that the Daniel Ortega administration, which extended its term through a disputed election, sought to gain aid by aligning with China amid anticipated economic difficulties due to U.S. sanctions.

With Nicaragua's announcement to sever ties, the number of countries maintaining diplomatic relations with Taiwan has decreased to 14, including Honduras and Guatemala.

At the time of severing diplomatic relations, the Nicaraguan government notified 52 individuals, including staff and families of the Taiwanese embassy in the capital Managua, to leave by the 23rd, two weeks later.

This content was produced with the assistance of AI translation services.