China Pursues Naval Outpost in Nicaragua to Threaten U.S.

TAIPEI, Taiwan — China aspires to open a “naval outpost” in Nicaragua as part of a plan to dominate the Indo-Pacific, Taiwan has warned.

“The Chinese are talking with them about also potentially setting up a naval outpost,” Taiwanese Vice Foreign Minister Alexander Yui told reporters this week. “So they have a very large plan.”

Nicaragua severed diplomatic relations with Taiwan last year in favor of new ties with Chinese General Secretary Xi Jinping’s regime, which claims sovereignty over the island democracy despite never having ruled in Taipei. Xi has deployed a mix of pressure and inducements to convince Taiwan’s dwindling number of allies to establish a connection with Beijing, an initiative that China has used both to isolate Taipei and gain advantages in relation to the United States.

“It’s part of their expansionist agenda — take over Taiwan, and break from the first island chain into the rest of the Pacific, take over the Pacific,” Yui said. “They are expanding. They want to become the predominant power in the world and also export their way of thought, their way of living, to the rest of the world.”

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China’s vaunted overseas infrastructure investment program, the Belt and Road Initiative, has been denounced by U.S. officials for years as a “predatory” lending scheme designed to allow Beijing to buy an empire. Nicaragua’s authoritarian leader, Daniel Ortega, seized the Taiwanese Embassy in Managua and transferred it to China in December, then signed a memorandum of understanding to join the BRI in January.

“The Chinese could do it and call it the beginning of the Nicaragua Canal if we ticked them off enough about Taiwan,” U.S. Army War College research professor Evan Ellis, who worked as a member of the State Department’s policy planning staff during then-Secretary of State Mike Pompeo’s tenure, told the Washington Examiner. “It would symbolically be a big deal, because the Chinese know they could get military access if they asked, and the Russians could operate out of it, too.”

Nicaragua’s switch was a strategic setback for the government in Taipei, which regards international recognition as an important bulwark against China’s desire to bring Taiwan under Beijing’s control. And by cutting ties with Taiwan, the Ortega government cleared an important obstacle from Beijing’s long-standing pursuit of port access in the region — although it remains unclear how those talks are progressing.

“China has very clear ambitions to become a major maritime power,” said Marcin Jerzewski, who leads the Taiwan office of the European Values Center for Security Policy in Taipei. “So it makes perfect strategic sense and is very consistent with Chinese strategic thinking, especially its maritime dimension.”

Ortega severed relations with Taiwan just weeks after the U.S. imposed sanctions on several members of his regime for “orchestrat[ing] a pantomime election” and arresting top opposition candidates and civil society activists. The idea of a Chinese port in Nicaragua offers both regimes an opportunity to pressure the U.S., although it “would be a big money loser” given Nicaragua’s corruption and the lack of an economic market to reward the project, as Ellis put it.

“I think there’s reasons why it could happen if the Chinese wanted to do a provocation that was big, but they could still [claim it was] a commercial port,” Ellis said. “Militarily, it would be more defensible than trying to operate out of Puerto Cabello, Venezuela, for example.”

For now, Nicaragua and China appear to be making only slow progress toward converting their newfound political affinity into major infrastructure developments, the analysts agreed, likely due to disagreements about to divide the cost of a port project.

If they can resolve such impediments, the development would be a symbol of the Chinese rivalry with the U.S. and a message to the global audience watching the competition unfold. “It would allow for more efficient power projection,” Jerzewski said. “Even if those bases are not used for kinetic conflict, their sheer presence would send a signal that China is indeed providing an alternative model for countries within the Indo-Pacific to follow.”

China has demonstrated in other parts of the world that success in convincing a country to cut ties with Taiwan can lead to other strategic benefits for Beijing, as well. The Solomon Islands, having severed relations with Taipei in 2019, struck a security agreement with Beijing in March, to the alarm of U.S. and Australian officials. Last week, the Solomon Islands refused to allow a U.S. Coast Guard vessel to make a port call during a patrol against illegal fishing.

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“It’s the changing of the attitudes of the Solomon Islands after their connection to the PRC,” said Yui, the Taiwanese vice foreign minister.