Myanmar moves closer to China

  • Economy
  • Saturday, 25 Jan 2020

Warm ties: A file picture showing Xi (left) and Suu Kyi shaking hands before a bilateral meeting at the Presidential Palace in Naypyidaw. In his talks with Suu Kyi, Xi called for efforts from both sides to implement the multi-billion dollar CMEC, mooted in 2017 — AFP

KUALA LUMPUR: Ahead of the official visit of Chinese President Xi Jinping to Myanmar on Jan 17 and Jan18, there was a resurgence of warnings by analysts on the risk of debt trap that could be created by mega projects under China’s Belt and Road Initiative (BRI) for developing countries.

Since the launch of the trillion-dollar BRI by Xi in 2013, the US and Europe have incessantly warned countries embracing BRI of the risk of surrendering their sovereignty over their properties, if they could not repay loans to Beijing for the projects.

There are also analyses that China is using this ambitious trans-national initiative, which China hopes to link up Europe, South-East Asia and China via overland and water transportation projects, to expand its diplomatic and economic influence.

But last weekend, Myanmar appeared to have shown great indifference to all these warnings during the visit of Xi, who was also there to mark the 70th anniversary of China-Myanmar diplomatic relations.

But this South-East Asian country, which enjoys close economic ties with China for decades, has shown it has gone its own way that suits its national economic strategy.

Like many other Asean countries, which see dwindling investment interest from the West and traditional sources, Myanmar’s economy is increasingly leaning towards China.

Citing Customs data, the Diplomat reported China’s total trade with Myanmar expanded by 28.5% year-on-year in 2019 to 128.9 billion yuan (about RM76.1bil).

China’s exports to the country stood at 84.9 billion yuan (RM50.1 bil), up 22.1% from the previous year, while imports surged 42.8% to 44.01 billion yuan (RM26bil).

In tourism, Chinese tourists now form a large segment of Myanmar’s under 500,000 tourists, posting a rise of over 160% in 2019, as Western tourists shun Yangan in which the junta still plays a key role in its rule.

More Chinese are expected to visit this country after Xi and Myanmar leaders attended a state event on Jan 17 to launch celebrations for the 70th anniversary of bilateral diplomatic ties and for the China-Myanmar Year of Culture and Tourism.

According to official China Daily, in talks with Myanmar’s state counsellor Aung San Suu Kyi, Xi called for efforts from both sides to implement the multi-billion dollar China-Myanmar Economic Corridor (CMEC), mooted in 2017 but has been stalled due to inter-ethnic conflicts within Myanmar.

Xi also underlined the need to press ahead the construction of highways, railways and power grids to enable the corridor’s main connectivity network to take shape soon.

He got what he wanted.

The outcome of the leaders’ meetings include agreements reached on the construction of railways linking south-western China to the Indian Ocean, a deep seaport in conflict-riven Rakhine state; a special economic zone on the China-Myanmar border and a new project in the commercial capital of Yangon.

The two countries also agreed to jointly build a China-Myanmar community “with a shared future” and a strengthened partnership in politics, economics, culture and people-to-people exchanges, as well as international affairs, according to a joint statement released on Saturday when Xi wrapped up his visit.

It was Xi’s first trip of the year and the first in 19 years in which a Chinese head of state has visited Myanmar, and the trip is hailed as “historic” and “significant” for bilateral relations by China Daily.“Xi’s choice to visit Myanmar on his first overseas trip of the year demonstrates the profound pauk-phaw (fraternal) friendship between the two countries and serves as an example of China setting in motion the building of a community with a shared future for mankind in a neighbouring country, ” said China’s Foreign Minister Wang Yi at the close of the visit.

Wang said this high-level diplomacy at the start of the year has ushered in “a new era for China-Myanmar relations”, in which the BRI has made major progress.

During the meeting with Myanmar’s President U Win Myint, Xi said China “firmly supports Myanmar in pursuing a development path that suits its national conditions.”

The agreements, in particular the one hastening the port project that will give Beijing vital access to Indian Ocean, reflect the deepening ties between Myanmar and China, Wang added.

The Chinese leader’s visit is significant for Myanmar as it comes at a time when Suu Kyi’s government is under intense international criticism for the 2017-2018 military actions against minority Rohingya in Rakhine state.

The military reportedly killed thousands and exiled over 730,000 to Bangladesh since August 2017, after deadly attacks by Rohingya on police stations in Rakhine state.

Myanmar now faces a lawsuit at the International Court of Justice (ICJ) based in the Hague, and last December Suu Kyi travelled to the Netherlands to fight the charges of genocide levelled against her country.

China is one of the countries that have not condemned Myanmar on the Rohingya issue.

Beijing has defended Suu Kyi’s government in forums such as the United Nations. Myanmar has insisted that that this is an issue of terrorism and separatism.

Myanmar has reciprocated by following Beijing’s positions on issues such as China’s claims over territory in the South China Sea.

During his meeting with Myanmar leaders, Xi reiterated China’s commitment to “stand ready to play a positive role in promoting Myanmar’s peace process and national reconciliation on the basis of respect for its sovereignty”.

But like other Asean countries, Myanmar is not totally oblivious to the high cost of some BRI projects and claims by China critics they primarily serve Chinese interests.

For example, China’s request to relaunch Myitsone hydropower dam, a US$3.6bil (RM14.7bil) Chinese-owned mega-project in Myanmar’s northern part was unsettled.

The project was frozen in 2011 after widespread opposition from the people.

The proposed construction site is at the confluence of the Mali and N’mai rivers and the source of the Irawaddy River in northern Myanmar.

The dam project has been controversial due to its enormous flooded area, environmental impacts, located 97km from the Sagaing fault line, and uneven share of electricity output between the two countries.

The Burmese regard the Irrawaddy River as the birthplace of Burmese civilisation. For many, the Myitsone Dam represents growing Chinese influence in Myanmar which they perceive as “exploitative” to the country.

China had in 2019 pressed Myanmar to relaunch the dam project, but Suu Kyi reportedly resisted it.

Her National League for Democracy will face voters in the national election later this year, and this unpopular project might risk support for her and her party.

Despite this friction since 2011, there is no question that the two countries have developed closer economic relations, say analysts.

Their cooperation on other electric power projects has continued. They include the Yeywa hydropower station, the largest power plant in Myanmar, which is supplying about 25% of electricity in this grossly underdeveloped country.

“Myanmar and China share a long history of friendly exchanges, and people have been bound together like brothers and sisters, ” U Win Myint, president of Myanmar, said in his address to the guests on Jan 17.

Myanmar and China have witnessed a momentous journey and leaders of the two countries have carried out close friendly exchanges, and observed the Five Principles of Peaceful Coexistence, he said.

Officials and experts have hailed Xi’s visit as “historic” and “a landmark” in their ties.

During his visit, Xi stressed China will never impose itself on others in international cooperation, and will never interfere in the affairs of other countries.

It opposes the “you lose, I win” and “one takes all” approaches, he said.

Xi’s tour also sent out a message that Beijing attaches importance to the relationship with this neighbour. Within his entourage were powerful personalities from China.

Myanmar, as a member of Asean valued by China, could play an important role in regional affairs and advancing BRI cooperation.

High-quality BRI cooperation between China and Myanmar has set a good example for other Asean countries, said Su Xiaohui, deputy director of the Department for International and Strategic Studies at the China Institute of International Studies.

Speaking to official People’s Daily, Su noted Myanmar’s active involvement in BRI projects, including the China-Myanmar Economic Corridor, is helping improve its people’s livelihood.

The China-Myanmar oil and gas pipelines, which run from western Myanmar to Southwest China’s Yunnan province, have been generating income and employment since they started operations in 2017.

The new BRI projects, from industrial parks and power plants to transportation facilities, if completed, will facilitate growth for Myanmar.

At the same time, China will benefit as the transportation project signed will shorten land-locked Yunnan’s distance to the sea, thereby diversifying China’s energy and trade routes.

While Xi’s visit to Myanmar brings forth a win-win economic formula for the two countries, he has also achieved another goal feared by the West: deepening Beijing’s diplomatic and economic influence in South-East Asia.

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