Ongoing Fighting Decimates Myanmar-China Border Trade

By Myo Pa Pa San 27 August 2019

YANGON—Myanmar’s border trade with China through the Muse border trade zone has virtually halted due to clashes in northern Shan State, causing huge losses to Myanmar producers and exporters, according to the Ministry of Commerce.

“The fighting in northern Shan State has cut off trade and [local businessmen] have suffered. We can’t confirm the extent of damage caused to [trade volume] through the Lashio-Muse and Lashio-Chin Shwe Haw trade routes, but it has seriously affected both imports and exports,” Union Commerce Minister Dr. Than Myint said at a meeting between the vice president and businessmen in Yangon on Saturday.

According to the Union minister, total trade value through the Muse border trade zone between the two neighboring countries declined from around US$5 million (7.6 billion kyats) per day before fighting began on Aug. 15 to around $700,000 per day since August 19—a decline of nearly 90 percent.

The Chin Shwe Haw border trade zone accounted for between $2 million and $3 million but has completely halted since Aug. 17.

The fighting has not just affected the trade sector, but also cargo truck and passenger vehicle drivers and owners, hurting local economic and social conditions too, the Union minister said.

The garment industry, which has helped narrow Myanmar’s trade deficit in recent years, is short of the raw materials it previously imported from China, he added.

“The government and concerned organizations are working together to address this. Though we are making the best of things, we’ve found that it can’t be solved easily,” he said.

The total value of unrealized trade for the six days between Aug. 19 and 24 in the Muse border trade zone is $25 million, and for the eight days from Aug. 17 to 24 in the Chin Shwe Haw border trade zone it is $16 million, according to the Commerce Ministry.

“Since clashes broke out on Aug. 15, no cargo truck has entered or left Muse. Only some remaining stocks of rice and sugar are being traded for the time being, and demand is quite low. As of today, there are no cargo trucks leaving or entering Muse,” U Min Thein, secretary of the Muse Rice Commodity Exchange, told The Irrawaddy on Monday.

There are only 3,000 to 4,000 bags of rice in stock at the exchange for export to China, and no imports at all from China, he said.

“Cargo trucks are stranded on Kutkai-Nam Phet Ka-Ho Moe Road. There are 280 cargo trucks stranded between Ho Moe and the 105th Mile Muse border trade zone, and around 300 trucks are stranded in the 105th Mile cargo truck terminal,” secretary of the Shan State Long-Distance Cargo Transportation Association U Win Aung Khant told The Irrawaddy.

“It is difficult to calculate losses. Perishable goods like eels and crabs transported from Mandalay have already gone bad by now and apples, grapes and oranges that were to be imported from China have already rotted by now,” he said.