China using reserves for political gain - report

China's State Administration of Foreign Exchange appears to have used its reserve stockpile, the largest in the world, to influence diplomatic relations between Costa Rica and Taiwan.

The Financial Times, a newspaper, reported on Friday that it had obtained a letter where Costa Rica agreed to cut its links with Taiwan in exchange for the State Administration of Foreign Exchange purchasing government debt.

The letter, written in January 2008, read: "From the date of the establishment of

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