China-Myanmar Economic Corridor a 'Win-Win'

By Myat Pyae Phyo 13 December 2018

MANDALAY — In September Myanmar signed a memorandum of understanding (MoU) with China to establish the China-Myanmar Economic Corridor, part of Beijing’s sprawling Belt and Road Initiative.

The initiative will link China with some 65 other countries that together account for more than 30 percent of global GDP and 62 percent of the world’s population.

While the Chinese government calls the initiative a bid to enhance regional connectivity, critics see it as a push for Chinese dominance in global affairs and for a China-centered trading network.

Mandalay Region Finance and Planning Minister U Myat Thu is a member of a joint committee established to oversee the corridor’s development. The Irrawaddy’s Myat Pyae Phyo spoke with him about what Myanmar was doing to manage the potential risks and rewards.

What is the Myanmar government doing regarding China’s Belt and Road Initiative?

The China-Myanmar Economic Corridor is part of the initiative. The Myanmar government has formed a central committee as well as a joint committee to establish the economic corridor. The committee consists of Union-level ministers as well as the planning and finance ministers of the five regions and states — Yangon, Mandalay, Shan, Rakhine and Irrawaddy — that the corridor will pass through.

The Union [planning and finance] minister last week discussed with us the proposed rail and motor road projects of the economic corridor project. He said China proposed implementing about 40 projects, but finally the two sides tentatively agreed to implement about nine projects as part of the economic corridor project.

One of the important projects is the Muse-Mandalay railroad and motor road that will pass through northern Shan State and Mandalay. A memorandum of understanding has been signed for it. It is likely to be implemented before 2020, after a feasibility study is conducted. Other projects still need detailed discussions.

 What are those nine projects?

The minister didn’t tell us the details. But I guess they are mainly about infrastructure. It seems to me that the government doesn’t want to place a debt burden on younger generations.

Again, the giver gives us grants and low-interest-rate loans because it will benefit in the future. So I think the leaders have chosen the nine projects that are most appropriate for us in consideration of that. It is important that we don’t act hastily. So detailed discussions will be had before memoranda of understanding are signed to implement those projects according to order of priority.

What is China’s focus in its proposal to the Myanmar government about the economic corridor project?

Mainly it wants to have ocean exits for its landlocked provinces. And it wants to trade the products of those landlocked provinces through us. And it will also bring the energy it bought from international countries through this route as well as the Kyaukphyu deep-sea port [in Rakhine State]. From a political point of view, it wants to have access to the Indian Ocean.

How should the government and local businessmen prepare for this project?

Local businessmen have to improve themselves. For example, take a look at the industry sector. Most of the industries are not well organized. Those who can innovate technically lack capital. There is no businessman to fund technical innovation. Those who have capital are satisfied with manufacturing for domestic production and do not bother to improve their products to be able to export. If they are to compete with others, they have to be strong themselves. And there is room for improvement in market research. They also need to improve their communication with the media.

What has the Myanmar government done to assess the possible environmental and social impacts of the project?

China has a poor record in that regard. So we will be very careful about the environmental impact and social impact assessments and will carefully monitor corporate social responsibility.

But the MoU signed by the state counselor covers land utilization, regional development and environmental conservation. So the concerns are not necessary.

Therefore we have only agreed on establishing the railroad from Muse to Mandalay for the time being, and not to Kyaukphyu. And the cultural heritage draft law, which aims to conserve cultural heritage across the country, has been submitted to Parliament and it will be promulgated next year.

Observers say Myanmar risks falling into a debt trap if it fails to handle the initiative properly. What do you say as a member of the joint committee for the China-Myanmar Economic Corridor?

The Union government is acting with much consideration. It does not borrow just because the loans have low interest. It makes sure the loan project can benefit the country in the long run.

The Myanmar government checks if the proposed projects in the economic corridor project comply with the Myanmar Sustainable Development Plan. It is careful not to choose projects that do not comply with it.

I studied the MoU and found that it adequately protects locals against the possible impacts of the rights given to China to use the land across the corridor, and provides opportunities for employment, education, health, and social and economic development for locals.

The MoU ensures a win-win policy for both sides. So I, on behalf of the Mandalay Region government, said at the preliminary meeting of the joint committee that we have no reason to oppose the project.

Translated from Burmese by Thet Ko Ko.