TAIPEI >> A U.S. cable released by WikiLeaks says Panama wanted to switch its diplomatic recognition of Taipei to Beijing after President Ricardo Martinelli took power in 2009, but China rejected the offer in order not to undermine its improving Taiwan ties.

Panama is one of only a few countries that recognize Taiwan and therefore forgo relations with its neighbor and traditional rival China.

The Feb. 23, 2010-dated cable from then U.S. Ambassador to Panama Barbara Stephenson came in the midst of President Ma Ying-jeou’s efforts to improve ties with China. The cable was released May 8.

Stephenson wrote in the cable that Martinelli had told her in May 2009, the month he won national elections by a landslide, that he would recognize Beijing because “he thought that Panama’s business community would benefit as a result.”

Stephenson said Martinelli’s high hopes were dashed when his Foreign Minister Juan Carlos Varela was told by Chinese Foreign Minister Yang Jiechi during an Asia visit in January 2010 that Beijing would not take on Panama to avoid foiling warming cross-strait ties.

Taiwan and China split amid civil war in 1949. Beijing still claims Taiwan as its own. Before Ma assumed office, the two sides had long fought a battle for diplomatic recognition, often resorting to lavishing funds on existing and potential allies.

While China enjoys a big advantage with its rising international clout, Taiwan has only 23 allies, mostly impoverished countries in Latin American, Africa and the South Pacific.

Ma has said that with his China reconciliation efforts, Taiwan will no longer be engaged in diplomatic tussles with Beijing for allies. Under Ma, Taiwan has not added or lost any diplomatic ties.

Stephenson also said that Taiwan offered financial incentives in late 2009 and early 2010 to bolster ties with Panama, including donating a $22 million business jet to the Panama government and a budget of $25 million for construction of a hospital on the outskirts of Panama City. She observed that there is “a traditional lack of transparency” in how Taiwanese donations are spent.

Taiwan’s Foreign Ministry spokesman James Chang said Thursday that Taiwan’s foreign aid programs have been reviewed and conducted in a legal manner, but declined to comment on the details of Panama’s intention to switch ties.