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Panama eyes trade deal with China after ditching Taiwan

'China-Panama relations have turned over a new leaf,' Chinese leader Xi Jinping said during talks with Panama's President Juan Carlos Varela

Panama and China agreed Friday to study the possibility of reaching a free trade agreement after the Central American nation ditched Taiwan and recognised Beijing. The memorandum of understanding was among 19 cooperation agreements signed by the two countries as Panama's President Juan Carlos Varela met Chinese leader Xi Jinping in Beijing. The two nations also reached agreements related to agriculture, civil aviation and maritime transport, as well as tourism to facilitate visits by Chinese tour groups to Panama. After the United States, China is the second-most frequent user of the Panama Canal. "China-Panama relations have turned over a new leaf," Chinese leader Xi Jinping said during talks with Panama's President Juan Carlos Varela, according to the official Xinhua news agency. Varela was treated to a state visit as he met Xi at the massive Great Hall of the People. On Thursday, Varela inaugurated his country's new embassy in Beijing. With Panama establishing relations with China in June, Taiwan is now only recognised by 20 nations. Mainland China and Taiwan split after a civil war in 1949 and while Taiwan sees itself as a sovereign nation, it has never formally declared independence. Beijing sees Taiwan as a renegade province that is part of Chinese territory and will be brought back into the fold at some point.