China has re-established diplomatic ties with Grenada, scoring a minor victory in its long-running dispute with neighbouring Taiwan. China's Communist government refuses to recognise any country that maintains relations with Taiwan, which it claims as part of its territory. Grenada was one of 27 countries, mainly African and Latin American nations, which boasted relations with Taipei. But Grenada had complained that Taiwan was not taking relations seriously. China and Grenada came to an agreement during talks in Beijing between the foreign ministers of the two countries. "Chinese Foreign Minister Li Zhaoxing and his Grenadian counterpart Elvin Nimrod signed a joint communique on Thursday to resume diplomatic ties between the two countries," the Xinhua news agency said. Taiwan suggested in the past that China had been offering millions of dollars worth of aid to Caribbean countries to make them switch allegiances to Beijing. The Taiwanese government itself has regularly used aid pledges as leverage to win diplomatic recognition. TAIWAN'S CARIBBEAN ALLIES Belize Costa Rica Dominican Republic El Salvador Guatemala Haiti Honduras Nicaragua Panama St Kitts and Nevis St Vincent and the Grenadines Grenada's move is the second blow to Taiwan's diplomatic policies in recent months, following a decision by Pacific island nation Vanuatu not to form diplomatic links with Taipei. The Grenadian Prime Minister, Keith Mitchell, visited Beijing last month and suggested that his country could re-establish ties with the mainland. He said he was hoping that China could offer reconstruction aid to help Grenada repair damage caused by Hurricane Ivan. Taiwan has offered Grenada $40m to rebuild its cricket ground. Last year the Dominican Republic cut ties with the island, claiming that its policy had been based on mistaken historical assumptions. China and Taiwan split in 1949 as the Communist Party came to power on the mainland. The two have remained bitter rivals ever since. Last week a deal to allow a one-off series of passenger flights between China and Taiwan was hailed as a sign of improving relations. Reprinted from bbc.co.uk and channelnewsasia.com