The Dominican Republic and China announced Tuesday they were establishing diplomatic relations as the Caribbean country became the latest nation to dump Taiwan, leaving it with just 19 diplomatic allies around the globe.

Taipei said it was "deeply upset" at the decision, which it blamed on "dollar diplomacy". The move deepens the island's international isolation while its giant neighbour flexes its economic and political might on the global stage.

The Dominican Republic said it believed its switch to ties with China would be "extraordinarily positive for the future of our country", in an official statement.

"The Dominican Republic recognises that there is only one China in the world, and Taiwan is an inalienable part of the Chinese territory," it added.

Taiwan is a self-ruling democracy which sees itself as a sovereign nation but has never formally declared independence from the mainland. Beijing considers it a renegade province to be brought back into the fold and is increasing international pressure to prevent any recognition of the island.

Beijing announced Tuesday morning that it would exchange ambassadors with the Dominican Republic "as soon as practicable".

Taiwan's foreign minister Joseph Wu said the government "deeply regrets that Dominican Republic and China established ties on May 1".

Wu said the ministry "strongly condemns China's objectionable decision to use dollar diplomacy to convert Taiwan's diplomatic allies" and accused Beijing of failing to honour its promises to those countries it had wooed away.

Its actions had damaged cross-strait relations and eroded trust, said Wu, who blamed China's financial incentives for ending Taiwan's 77-year alliance with the Dominican Republic.

The foreign ministry had summoned the Caribbean country's ambassador to deliver a protest and tell him to close the embassy, Wu said.

- Vatican next? -

Taiwan now has 19 diplomatic allies left -- 10 in Latin America and the Caribbean, two in Africa, six small island nations in the Pacific and the Vatican.

Beijing and the Holy See severed diplomatic relations in 1951 and remain at odds over who should appoint bishops.

But an apparent warming of relations between China and the Vatican -- considered Taiwan's most powerful remaining official ally -- has triggered concerns that the Holy See may also switch allegiance in what would be a crushing blow to Taipei.

Wu insisted that ties with the Holy See "would not be in immediate danger" even if there were a breakthrough agreement on designating bishops in China.

In June last year Panama cut ties with Taipei to open relations with Beijing while Costa Rica did so in 2007.

"This latest development is proof, yet again, that Taiwan needs to focus its energies developing solid and multifaceted ties with unofficial diplomatic allies," said J. Michael Cole, a Taipei-based senior fellow at the University of Nottingham's China Policy Institute.

The Dominican Republic joins a long list of small countries that "in a heartbeat will throw principle out the window for the sake of getting more from China", Cole added.

Taipei's Mainland Affairs Council slammed the Dominican Republic's move, blaming Beijing for undermining cross-strait ties.

"We call on China to immediately stop provocative actions of exerting extreme political and military pressure on Taiwan," it said.

- 'A warning' -

The government of President Tsai Ing-wen is trying to enhance Taiwan's international profile but faces a concerted attempt by Beijing to shrink its space on global platforms.

Taiwan is regularly shut out of influential forums as organisers come under pressure from Beijing.

Mainland China and Taiwan have been ruled separately since the end of a civil war in 1949, when the defeated Nationalist government fled to the island.

Beijing has consistently said it wants Tsai to recognise that Taiwan is part of "one China" but she has not done so.

Comments by premier William Lai expressing his personal support for Taiwan's independence have further riled Beijing.

"Given the current cross-strait political climate, things like this (losing an ally) are bound to happen sooner or later, it's just a matter of when and which country," said political analyst Tang Shao-cheng at the National Chengchi University in Taipei.

"The timing of China establishing ties with the Dominican Republic is meant as a warning for Taiwan not to cross the red line to show support for Taiwan independence, since (Beijing's) recent verbal intimidation and sabre-rattling did not yield desirable results," she said.

burs/lm/sm

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