The relationship between China and its closest ally Myanmar has moved from being special friends earlier in 2020 to a sense of suspicion as the year comes to an end.
The change in that relationship is set to have an impact on the Chinese expansionist plan under the Belt and Road Initiative (BRI).
Recently, Myanmar indirectly accused China of creating trouble by arming rebel groups and expressed concerns over the construction of fences on the border in violation of a bilateral agreement.
China has begun building a 2,000-km-long fence along its border with Myanmar as a part of a “Southern Great Wall.” The steel fence is 3 meters high, topped with a barbed coil; 659-km is already built near Laukkai Township in the Kokang Self-Administered Zone (SAZ) in Myanmar’s northern Shan State.
China began construction on the wall after ignoring the 1961 Boundary Protocol, creating apprehension in Myanmar.
Sai Tun Aye, a Lower House lawmaker for Monghsu Township in Shan State, said China is behaving like a bad neighbor.
“China’s unilateral move to construct the fence reflected the power imbalance between the two nations. Our country is weak on all sides. We always experience the same kind of bullying from China,” he said. A few years ago, Chinese villagers built a fence almost 30 meters inside Myanmar in Hpai Kawng Village.
China has maintained that the wall is being built to prevent infections from COVID-19. However, defense experts maintain the real intentions are anything but pandemic related.
Instead, they said, the wall would stop Chinese citizens, including dissidents, from crossing into Myanmar to do business. Since many people who migrate never return to China, the Beijing government has come up with the wall in an effort to stop Chinese nationals from escaping.
On the one hand, the China-Myanmar Economic Corridor (CMEC)—a 1,700-km long infrastructure route that connects Yunan province in Southern China with the Indian Ocean–has 38 projects planned in Myanmar.
However, the CMEC largely remains on the drawing board rather than a reality. The government as well as the people of Myanmar look at Chinese investment with suspicion. Aside from fear of falling into a debt-trap, local human rights groups are concerned about sustainability issues and the threat to local livelihoods.
The military in Myanmar also views China with distrust. The primary reason is that it suspects China of supporting armed ethnic rebels along the China-Myanmar border.
Research conducted by the International Growth Centre, an economic research center based at the prestigious London School of Economics, showed the inflows of Chinese multinationals were “by far the most controversial and have faced the most opposition within Myanmar.”
Nationwide opposition to the US$3.6-billion Myitsone Hydropower Project in Kachin State by a Chinese state-owned enterprise led the Myanmar government to suspend it.
“There is an explicit bias against Chinese investments, which is likely based on the experience of Chinese investments, or implicit bias against China. Japanese firms are regarded (or perceived) much more positively than their Chinese counterparts, even when firms from both countries similarly collaborate with military-affiliated local companies and do not directly engage with local communities in their operations,” the research study concluded.
Myanmar’s government has taken a cautious stance regarding the implementation of the BRI projects. It has decided to subdivide certain tenders for the construction of Yangon New City, which would allow more foreign companies, particularly Western ones, to participate in construction. Also, the role of China in Myitkyina Economic Development Zone (MEDZ) has been minimized over land acquisition and the compensation package.
Tin Oo Yu, chairman of the Kachin parliament’s planning, finance and public accounts committee, said there was fear that locals would lose their lands, and China would monopolize the BRI ventures.
In September, Yang Jiechi, the head of the Central Foreign Affairs Commission of the Chinese Communist Party, visited Myanmar and sought reassurances on the implementation of BRI projects.
Yang, a member of China’s powerful Politburo, met separately with State Counselor Daw Aung San Suu Kyi, President U Win Myint, and military commander-in-chief Senior General Min Aung Hlaing in Myanmar’s capital Naypyidaw.
Yang’s meeting came nearly eight months after he accompanied Chinese President Xi Jinping on a state visit to Myanmar to mark the 70th anniversary of the establishment of diplomatic relations between the two countries and to sign several deals to implement infrastructure projects under Xi’s signature BRI program.
Yang and Myanmar top leaders discussed speeding up work on the massive BRI projects, advancing the build-out of the CMEC, improving bilateral trade and investment, and ongoing support for Myanmar’s peace process, according to Chinese and Myanmar media reports.
The Myanmar-based think tank Institute for Strategy and Policy (ISP) has observed that despite Chinese pressure and the visit by Xi, Myanmar’s government has not ensured BRI projects would be expedited. Daw Khin Khin Kyaw Kyee, head of the China desk at the ISP, observed, “The Myanmar government is very cautious and the process is still slow. That is the major reason Yang Jiechi came to Myanmar.”
She also said that the key BRI projects like the Kyaukphyu SEZ are commercially unfeasible. This will come as a big blow to China since the SEZ facilitates China’s access to the Indian Ocean.
“It would take at least 10 to 15 years to become commercially viable. But it is still not certain. The result will also depend on geopolitical factors, because the project’s implementation is being planned from a strategic perspective of giving China access to the Indian Ocean,” she added.
The recent building of the fence and wall on the border caused concern among Myanmar officials and locals. But the fact that China’s projects in Myanmar are still on the drawing board has also created uneasiness in Beijing.
Yan Naing is the pseudonym of a regular observer on Myanmar affairs. The views expressed are his own.
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