Myanmar Junta Pushing China to Restart Stalled Infrastructure Projects

By The Irrawaddy 23 December 2021

Faced with record lows of foreign direct investment, Myanmar’s military regime is pushing China to restart several stalled infrastructure projects, including railways, ports and power projects, and to accelerate bilateral cooperation over the coming months.

In a joint statement issued on Wednesday, the junta’s Ministry of Information and Ministry of Investment and Foreign Economic Relations said that Myanmar enjoys a special paukphaw or kinship with Beijing after 71 years of bilateral ties.

Claiming that normalcy is returning to Myanmar, the junta said in its statement that the implementation of several joint projects with China is a major priority for Myanmar, following the disruptions caused by the pandemic and recent social unrest.

However, Beijing remains wary about resuming full cooperation with Myanmar after the widespread anti-China protests that followed the regime’s February 1 coup, and subsequent attacks on Chinese-owned factories in Yangon.

Myanmar has been in political, social and economic turmoil since the coup, with a majority of the country’s population rejecting the military takeover and rebelling against the regime’s rule through both civil disobedience and armed resistance. Since the coup, the junta has killed more than 1,300 people, while over 11,000 have been detained, according to the Assistance Association for Political Prisoners, a rights group which monitors deaths and arrests.

Foreign direct investment dried up after the coup, including for existing projects, with western countries imposing sanctions on the regime. The World Bank has projected that Myanmar’s economic growth is set to shrink by 18 per cent this year, as military rule hammers what was previously one of Southeast Asia’s fastest-growing economies.

The junta’s joint statement claimed that the regime has improved security and provided assistance to Chinese-owned factories that were attacked by civilian resistance fighters. It also said that such attacks have declined sharply, so the regime is confident that the situation for China’s investments in Myanmar will soon improve.

The junta’s governing body, the State Administration Council chaired by coup leader Senior General Min Aung Hlaing, has reviewed and revised bilateral economic projects to prioritize its plans for economic recovery, as Myanmar prepares for a new election scheduled to be held by August 2023, the statement added.

To further improve bilateral cooperation with China, the junta said it would pilot accepting China’s currency, the Renminbi, as an official settlement currency for border trade starting next year.

“Myanmar Government will do its best to protect all foreign direct investments, including those from the PRC. We also look forward to increased border trade through RMB-kyat settlement,” the junta-appointed Minister of Investment and Foreign Economic Relations, U Aung Naing Oo, said in the statement.

In May, Snr-Gen Min Aung Hlaing reassured Beijing that his regime will protect foreign-funded enterprises in the country, including Chinese ones, amid the chaos caused by his coup.

“We will protect all foreign-funded enterprises [in the country],” he told Hong Kong-based Phoenix Television, adding that Myanmar people are not anti-China.

Snr-Gen Min Aung Hlaing has attempted to calm Beijing’s concerns about its economic interests, following growing anger towards China among Myanmar people due to Beijing’s perceived support for the military regime.

In his interview with the Beijing-supporting Phoenix Television, Snr-Gen Min Aung Hlaing said that attacks on China-backed factories are not a result of anti-China sentiment in Myanmar, saying instead that the political situation is to blame.

But Chinese officials are still concerned about the possibility of future attacks and the impact on public sentiment in Myanmar if the junta restarts the projects.

However, China is ready to resume development and Infrastructure projects if and when stability returns to the country. In the past months, Chinese teams have conducted field surveys on several projects in Myanmar.

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