Is it wise for Beijing to isolate Taiwan?

President-elect Donald J Trump’s transition team had issued assurances that there would be no contact between them and the Taiwan leader during her transit layovers. China’s sensitivity stems from an unprecedented phone call the Taiwan leader made to congratulate Trump on his electoral triumph even though the two sides have no diplomatic relations.
China has made clear that Taiwan will have to pay for such transgressions. A Global Times commentary on January 10 trumpeted, “Tsai had a phone call with Trump, but soon Sao Tome and Principe broke ties with Taiwan. It is certain that more countries will do the same.” After Honduras, the Taiwan leader will go to Nicaragua to attend the inauguration of Daniel Ortega, who will begin a new presidential term. At the ceremony, she will have a rare opportunity to meet other foreign leaders.
After that, Tsai is scheduled to visit Guatemala and, finally, El Salvador, before returning to Taiwan via San Francisco.
The four Central American countries represent a significant portion of the 21 countries that still accord diplomatic recognition to Taiwan rather than China. In 2007, just before Ma Ying-jeou became president, Costa Rica broke relations with Taiwan to establish ties with China.
Then, for the eight years of Ma’s presidency, there was an unspoken “diplomatic truce” in which China refrained from grabbing Taiwan’s diplomatic allies. Thus, in 2008 when Paraguay indicated interest in relations, Beijing was unresponsive. Similarly, in 2009, when Mauricio Funes won the presidential election in El Salvador, he was quoted as saying that he would consider establishing relations with China and severing ties with Taiwan.
The Chinese foreign ministry spokesman rather pointedly responded that “despite the absence of diplomatic ties, the Chinese people have friendly feelings towards the Salvadoran people, and we are willing to carry out friendly exchanges and mutually beneficial cooperation in various areas with Salvador.” The emphasis was on developing friendly exchanges in the absence of diplomatic relations.
But now that Tsai Ing-wen is president, the diplomatic truce is over. Tsai will have to be sensitive to signs that other countries will follow Sao Tome’s example. This is especially the case since Taiwan is in no position to compete with China in terms of cheque book diplomacy.
El Salvador and other countries must be reassessing whether they should stick with Taiwan or switch to China.
A commentary in the official China Daily newspaper on January 5 referred to the decision by  Sao Tome and added darkly, “The same could happen with Taiwan’s remaining 21 ‘allies.’” But China needs to gauge the wisdom of attempting to strip Taiwan of all its diplomatic allies.
What are the implications of such a move to isolate Taiwan diplomatically? At present, Taiwan’s formal name is the “Republic of China” (ROC) and the 21 countries that recognise it have relations with the ROC, not with a “Republic of Taiwan”.
If no country in the world recognises the Republic of China, Taiwan will have no choice but to be Taiwan. It will no longer be Chinese.
Moreover, Taiwan can survive without formal diplomatic relations. It will then focus on its substantive relations, such as those with the US, Japan and other countries, who do not recognise the “Republic of China.” The ostensibly unofficial US embassy in Taipei, for example, doesn’t have the word “China” in its name. It is simply the American Institute in Taiwan.
Japan, when it established relations with China in 1972, created something called the Interchange Association to be its “unofficial” embassy.
However, last week, on January 1, the name was changed to Japan-Taiwan Exchange Association, recognising the island as Taiwan, not China. This may well become a trend. Because of its economic importance, other countries need to have dealings with Taiwan and they need to call it something.
If the name doesn’t have “China” in it, it is likely to have “Taiwan”, thus eroding the island’s connection with the mainland and in practice strengthening Taiwan independence, certainly something China doesn’t want.
Would such a development be to the benefit of Beijing, which says it wants “peaceful reunification” between the mainland and Taiwan in the long run? Perhaps more importantly, will such a humiliation by China help or hinder the China-friendly political party, the Kuomintang, in its attempt to return to power in Taiwan?