This record is a partial extract of the original cable. The full text of the original cable is not available.

S E C R E T SECTION 01 OF 02 SAN SALVADOR 002426 
 
SIPDIS 
 
E.O. 12958: DECL: 08/30/2025 
TAGS: ECON PREL ETRD ETTC EINV ENRG EAGR EFIN PHUM EMIN CH ES ESENV
SUBJECT: CHINESE ACTIVITIES IN EL SALVADOR 
 
REF: A. SAN SALVADOR 2333 
 
     ¶B. STATE 138041 
     ¶C. 04 SAN SALVADOR 3103 
 
Classified By: Michael A. Butler, DCM, U.S. Embassy San Salvador. 
Reasons: 1.4 (B) and (D) 
 
¶1. (U) The following is provided in response to Ref. B. 
 
Summary 
------- 
¶2. (C) El Salvador does not have diplomatic relations with 
China and instead has ties with Taiwan. As a result, official 
Salvadoran contact with the Chinese is limited. Trade and 
investment volumes are very low. However, the leftist FMLN 
political party does maintain direct contact with the Chinese 
and has hosted Chinese visitors on several occasions. 
Military to military contacts are nonexistent. Although there 
is some diversity of opinion among Salvadoran government 
officials regarding expanding the country's relationship with 
China, official recognition of Taiwan is likely to remain in 
place at least while President Saca is in office. End summary. 
 
Economic relations weak 
----------------------- 
¶3. (U) According to Ministry of Economy data, El Salvador's 
total trade with China was valued at $117.2 million in 2004. 
Of the $3.6 million in exports from El Salvador to China, 
$2.2 million were scrap metals and 0.5 million agricultural 
goods. Salvadoran imports of Chinese goods totaled $113.6 
million, including $19.1 million in textiles and apparel, $18 
million in shoes, and $7 million in audio/visual equipment. 
Detailed trade data for 2001-2004 is available at 
www.minec.gob.sv for download in spreadsheet format. There 
have been no discussions on trade agreements between El 
Salvador and China. There may be limited Chinese investment 
in El Salvador, but only indirectly through cross-ownership 
of Taiwanese firms by Chinese investors (Ref. A). The Chinese 
provide no development assistance to El Salvador. 
 
Political relations through FMLN 
-------------------------------- 
¶4. (S) El Salvador does not maintain official political ties 
with the Chinese and instead maintains diplomatic relations 
with Taiwan (see Ref. A). However, from February 28 to March 
2, 2005, a Chinese delegation headed by Vice President of the 
Institute of External Affairs Wang Zhen spent three days in 
El Salvador meeting with Salvadoran businessmen and leftist 
political leaders. SIMO reported that President Saca had 
authorized the visit at the behest of the FMLN, a leftist 
opposition party, which supports breaking ties with Taiwan 
and establishing relations with China. SIMO also reported 
that Saca prohibited members of the government from meeting 
with the delegation. However, Wang did meet with FMLN 
deputies. Wang told the media that diplomatic recognition 
would enhance commercial relations with China and made clear 
that such recognition would necessitate the severance of El 
Salvador's diplomatic ties with Taiwan. In keeping with El 
Salvador's historical position, President Saca publicly 
replied to the Chinese suggestion that it break ties with 
Taiwan by saying, "No country can place conditions on El 
Salvador's external relations . . . If Chinese investors want 
to invest in the country (El Salvador), then let them come, 
but we are going to continue to have relations with Taiwan." 
 
¶5. (S) As noted above, the FMLN maintains a direct 
relationship with the Chinese, and were the FMLN to win the 
presidency, there is no doubt that El Salvador would cease to 
recognize Taiwan and would instead establish diplomatic 
relations with China. SIMO reported that in late June China 
opened a "Friendship House" in Quezaltepeque, an FMLN 
stronghold. The house is intended to support cultural 
exchanges between the people of El Salvador and China, but 
Salvadoran officials have expressed concern that it will be 
used for political purposes. SIMO reported that in early June 
2005, the Chinese notified the FMLN that it was canceling a 
planned mid-June visit by a high-level FMLN delegation to 
China due to Beijing's displeasure with internal dissension 
within the FMLN that led to the resignation of 300 FMLN party 
loyalists. SIMO also reported that on December 12, 2004, a 
Chinese delegation headed by the Central Committee's 
Sub-Director for Latin America and the Caribbean met in San 
Salvador with representatives of the FMLN and leftist groups 
from Guatemala, Honduras, Nicaragua, and Mexico. On December 
13, the delegation met with FMLN Mayor of San Salvador Carlos 
Rivas Zamora. 
 
No military relations 
--------------------- 
¶6. (S) DAO reports that the Salvadoran military has no 
relations with the Chinese and is not interested in 
establishing such a relationship. As noted in Ref. A, the 
Salvadorans maintain an extensive military relationship with 
Taiwan. 
 
Comment: Future diplomatic relations unlikely under Saca 
--------------------------------------------- ----------- 
¶7. (C) We believe it unlikely that El Salvador will change 
policy and sever ties with Taiwan to establish them with 
China while Saca is President, given the Chinese support for 
the opposition party (Ref. C.). There is a belief among some 
that a more vibrant trade and investment relationship with 
China could bring benefits to the Salvadoran economy. 
Balanced against this potential, however, is the tangible aid 
and investment that Taiwan currently offers (Ref. A.). End 
comment. 
Barclay