Some areas of Myanmar are running out of food, medicine and consumer goods due to China’s ban on exports to the country following a rise of fighting along its border in Kachin State and northern Shan State, and the junta’s crackdown on “illegally imported” goods from neighboring China and Thailand.
The cash-strapped regime imposed restrictions on import and export permits to reduce the need to spend foreign currency. Recently, it also launched a crackdown on goods imported across land borders, claiming that the illegal trade was financing resistance groups.
Meanwhile, the government of Yunnan province suspended the export of foodstuffs, household goods, electronics, engines, solar panels, and building materials across its border to Myanmar on October 22.
Myanmar relies heavily on neighboring Thailand and China for a wide variety of essential goods, ranging from food to fertilizer. Shortages of consumer staples, like cooking oil, coffee, instant noodles, toothpaste and soap, have been reported.
To pressure the ethnic armies fighting the regime, China has closed border crossings with rebel-controlled Laiza, Maijayang, Kanpiketi and Pangwa towns in Kachin State, as well as other border crossings in northern Shan State.
One resident of Bhamo town displaced by the fighting in Kachin said: “China has closed all border crossings with Kachin. Both legal and illegal trade is not allowed. We are going hungry.”
Northern Shan State has reportedly run out of medicine.
A resident of the border town Muse said: “Only people can cross the border through Muse. Food prices have started to increase. It is difficult to buy things like instant noodles.”
Construction companies said the sector, which relies on China for electronics, iron, aluminum, tiles, pipes and toilet bowls, will be hit by the border closures.
A building contractor said: “Import permits are difficult to secure. As a result, the price of some goods has not declined, even though the value of the dollar has fallen. Those who import in any way are being hit by the crackdown, resulting in shortages. To make matters worse, China has closed the border.”
Many businesses were already struggling due to the economic crisis triggered by the 2021 military coup. Business owners say the latest developments may impact construction companies and cause job losses in that sector.
The building contractor said: “The crackdown on illegally imported goods, the border closure by China, and the slow economy … combined [they] will have serious impacts. As to China, we need to import from it in every sector. In the construction industry, we import almost everything from China. So, it is likely that prices may further increase, and supplies will run out.”
Business owners said sea freight is not a viable option, because it takes a minimum of three months to a maximum of one year to obtain an import permit, and there are also time issues regarding the use US dollars regulated by the junta-controlled Foreign Exchange Supervisory Committee.
A merchant in Muse said: “China has been imposing tighter restrictions. At first, it banned the export of medicine, and now it bans [exports of] foodstuffs, electronics and consumer staples. Border areas relying on China are in trouble. Northern Shan State has run out of medicine and fuel supplies are dwindling.”
Fuel prices have shot up in border towns with filling stations imposing a quota, according to residents of Shan State’s Hopan town.
The regime has imposed a massive crackdown on illegally imported goods in Karen and Mon states as well as Mandalay Region, raiding warehouses and confiscating goods, according to business owners in Mandalay.
One said: “They started searching warehouses and seizing goods this week. Both Chinese and Thai goods were targeted.” The regime has sold seized perishable goods at auctions, and owners bought them back, he added.
Merchants in Karen and Mon states say they can retrieve their seized goods by paying a fine to junta personnel.
According to the Illegal Trade Eradication Steering Committee meeting on October 9, the regime confiscated more than 300 billion kyats worth of illegally imported foodstuff and consumer goods from January 2022 to August this year. The seized goods were either auctioned or returned to owners who paid a fine.
