Rakhine Rebels Eager for Foreign Investment

By Moe Myint 23 July 2019

YANGON—The Arakan Army (AA) has signaled to foreign developers it wants them to invest in Rakhine State, noting that the region is on an essential part of Chinese President Xi Jinping’s signature Belt and Road Initiative (BRI)—the proposed comprehensive trade and logistics route linking China and Europe through Central Asia, the Middle East and Russia.

The AA’s political wing, the United League for Arakan (ULA), announced in a three-part statement that it is accepting investments from foreign investors, including BRI-related projects.

Elsewhere in the statement the ULA refuted the Myanmar military’s accusation that the AA is terrorist group and said its armed struggle against the military (or Tatmadaw) is for self-determination.

As battles rage throughout the north (and in some parts of the south) of Rakhine State—including in Kyaukphyu Township, the site of large Chinese oil-and-gas pipelines and deep seaport projects—the AA’s embrace of foreign  investment has attracted both praise and criticism. Some question if doing business in a region racked by war is too risky for investors.

So far, armed conflict between the AA and the military has displaced more than 50,000 people in Rakhine State, and bilateral peace talks have been stalled since April. Fighting remains intense, with the military reinforcing troops in the region with navy frigates, Russian attack helicopters and artillery units.

Still, international developers from Singapore, Malaysia and China have proposed billion-dollar projects in the state capital of Sittwe and in Kyaukphyu Township, on Ramree Island, in recent months.

Brig-Gen Nyo Tun Aung, AA deputy chief, said the ULA and the AA have been public about their stance on China’s BRI project since 2017, saying that they believe ethnic regions stand to benefit from the project. He said Rakhine State is politically and geographically important to the BRI, with several projects completed or currently in the process of being completed in the region.

“The reason that we restated our view on the BRI now is that we assume this is the right time to stress our stance. In other words, we can say we’re also releasing our ULA foreign policy and revealing our dreams,” said Brig-Gen Nyo Tun Aung.

China is a familiar place for AA top brass, some of whom live in Laiza, home to the headquarters of the Kachin Independence Army in the north of Myanmar’s Kachin State, near the Chinese border. Brig-Gen Nyo Tun Aung said he has visited a town in China where a large and well-known coffee company with global distribution is located. The company’s distribution map shows a targeted future site linked to the BRI project in Kyaukphyu Township, he said.

“The word ‘Kyaukphyu’ on the map caught my attention. As an Arakanese, it gives me goosebumps. We Arakanese also want to get the same opportunity in BRI projects as other countries have,” he said.

According to him, the ULA and the AA document foreign companies that are currently doing business in the state. He said the AA expects to work hand-in-hand with interested developers in Rakhine State in the future as part of the Arakan Dream 2020, an aspirational self-determination initiative.

Asked if the AA owns institutions for international developers to work hand-in-hand with in the state, Brig-Gen Nyo Tun Aung said, “We are doing our homework.”

Former UK ambassador and Myanmar Center for Responsible Business Director Vicky Bowman told The Irrawaddy that investors in Rakhine State need to understand all of the AA’s views even if they can’t communicate with them directly. She suggested investors understand the AA thoroughly as part of a wider “conflict-sensitive approach,” recognizing that the AA does not represent or speak for all Rakhine people.

“The best way to do that is to ensure accurate, complete and up-to-date information is widely and publicly available, and provide for channels for any stakeholders to give their views and raise questions,” she said.

Oliver E. Soe Thet, a German businessman who operates a hotel in the popular southern Rakhine tourist destination of Ngapali Beach, said the AA statement could boost investor confidence by assuring international investors of the professionalism of the AA, who he said know that the AA commands the vast majority of support from the people of Rakhine State.

“This again will also give China a better way to calculate when and how much they will invest in the near future,” he said.

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