Before he disembarked from the charter plane, Ma was greeted by director general of the Paraguayan foreign ministry's Department of Protocol and by David Hu, Taiwan's ambassador to Paraguay. He then disembarked and walked along a red carpet with a military honor guard lined up on both sides, to be received formally by Paraguayan Interior Minister Libio Florentin and his wife.

The minute Ma stepped off the Miami Airlines charter flight, around 300 hundred Taiwanese expatriates, who were lined up along the red carpet, began waving national flags of the Republic of China and calling out, "Greetings, President Ma."

Lin Shih-wei, first secretary of the Republic of China's Embassy in Paraguay, told the Central News Agency that many of the expatriates were from nearby countries such as Chile and Argentina, and that some had traveled to Paraguay a few days earlier just to greet Ma.

The purpose of Ma's first state visit since he took office May 20 is to attend the inaugurations of Paraguayan President-elect Fernando Lugo on Aug. 15 and Dominican Republic President-elect Leonel Fernandez on Aug. 16.

After acknowledging and shaking hands with the Taiwanese expatriates, Ma delivered a three minute speech at the airport, saying that he was deeply moved by the warm welcome, especially in light of the fact that he had arrived close to midnight.

"Taiwan and Paraguay have had 51 years of deep and solid friendship," Ma said. "I would like to take this opportunity to consolidate our diplomatic relations and further develop the existing bilateral cooperation.

Noting that the outgoing Paraguayan President Nicanor Duarte had visited Taiwan twice and that former Taiwan President Chen Shui-bian and former Vice President Annette Lu had also visited Paraguay, Ma said the links between the two countries are "very close."

Lugo had said many times that he would like to switch diplomatic recognition to China -- a statement that spurred speculations that Taiwan might lose its only diplomatic ally in South America.

Media reports from Paraguay said that the country's Vice President-elect Federico Franco has requested US$71 million in foreign aid from Taiwan and has threatened to sever ties with Taiwan before Lugo's inauguration if it did not receive the funding.

Lugo, however, told the Asuncion-based ABC Color daily news Tuesday that his government will maintain ties with Taipei -- a message that was welcomed by Taiwan.

Since President Ma Ying-jeou took office on May 20, he has sought an end to the longstanding diplomatic tug-of-war with China, in which both sides compete for recognition by giving large sums of money to developing countries desperate for funds, a practice that critics call checkbook diplomacy.

Speaking to reporters on the charter flight from Los Angeles to Paraguay after making a refueling stop in Panama, Foreign Minister Francisco H.L. Ou said he did not know what made Lugo change his mind, adding that Taiwan nevertheless welcomed the assurance.

"The foreign ministry's stance is that any new bilateral cooperation between Taiwan and its allies must be project-oriented, and the ministry will make evaluations before deciding whether to approve foreign aid," Ou said.

From now on, Ou said, he will ask the ministry to monitor all foreign aid and will grant funds depending on the efficiency with which these projects are implemented.

However, "it is the transfer of technology and experience that is most effective in helping these countries," Ou added.