Taiwan is a sensitive issue for China's ruling Communist Party, which considers the self-governing island of 23.6 million people a renegade province that should be brought under its rule. "The United States government took these actions unilaterally, in an attempt to appease the Communist regime in Beijing".
"That seems to be what the Chinese are targeting the most", said Yun Sun, East Asia Program senior associate at the Stimson Center research group in Washington.
In an effort to uphold relations with Beijing, most high-ranking USA military officers have always been banned from traveling to Taiwan and lower-ranking officers were not allowed to wear military uniforms and had been forced to dress as civilians.
"Our two democracies share common values of individual freedom, the rule of law, and a respect for human dignity", Mr Pompeo said.
China has condemned the United States for scrapping curbs on interactions with Taiwan officials, saying nobody could prevent the country's "re-unification", while Taiwan's foreign minister hailed the U.S. move as a sign of "global partnership".
On Wednesday, US ambassador to the United Nations, Kelly Craft, will arrive in Taipei for a three-day visit, which China has denounced.
Analysts say they will be unhappy with such a policy decision being made in the final days of the Trump administration, but that the move could be reversed easily by Mr Pompeo's successor Antony Blinken. "I'm grateful to @SecPompeo & StateDept for lifting restrictions unnecessarily limiting our engagements these past years".
However, the State Department's move doesn't shred the Taiwan Relations Act, and the release notes that the American Institute in Taiwan (AIT) remains the only avenue for executive branch relations with Taiwan."The big TAIWAN on the cover will accompany the people of the country to travel around the world, and it will also make the worldwide community more unable to ignore the existence of Taiwan", she wrote. The topic for the visit is to discuss how to promote Taiwan's worldwide participation.
Pompeo insisted the US' job, as well as that of its state-run media such as VOA, must be to promote American values.
In the second communique of 1979, signed on the occasion of establishing formal diplomatic relations with China, the USA declared that it recognizes the Beijing government as the "sole legal government of China".
The move is likely to anger China and increase tensions between Washington and Beijing.
The United States has deepened its relationship with Taiwan during the Trump administration.
"We are expressing our gratitude toward the USA for speaking out and supporting Taiwan", Premier Su Tseng-chang told reporters. Remarks containing abusive and obscene language, personal attacks of any kind or promotion will be removed and the user banned. "The dire consequences will be beyond anyone's predictions", it said.
Lifting the restrictions is expected to upset China, who maintains their stance that Taiwan is part of the Chinese government.