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Myanmar's China Problem

By: Aung Tun 

After a 1988 student-led uprising for democracy was crushed by a military coup, the United States imposed economic sanctions against Myanmar. China, however, did not recognize the sanctions and began taking over almost every profitable sector of Myanmar’s natural resource-based economy, including jade, gold, mining, minerals, natural gas, hydroelectric, and timber. China also developed close relations with the Myanmar military junta, which they have fought to protect. In January 2007, at the United Nations Security Council, China vetoed a resolution to impose greater sanctions on Myanmar. China also protected the brutal regime from harsh international condemnation after it crushed the Saffron Revolution in 2007.  

The Myanmar generals view China as an ‘excellent neighbor,’ whose huge investments helped keep their regime alive. The Myanmar people, however, have suffered under China’s staunch support of the brutal regime. Consequently, anti-Chinese sentiment has spread widely among the public. Whenever there is a serious discussion about Myanmar at the UN, the Myanmar public knows that China (and perhaps Russia) will block any resolution that could aid their position.

With support from the previous military regime, the Union of Myanmar Economic Holdings Limited (UMEH) partnered with a Chinese mining company to extract massive amounts of copper to sell to China. In early March, the reformist minister Aung Min visited the mine and had candid conversations with local villagers. During the visit he said, “We are grateful for China for its continuously staunch support while we were isolated from the international community.” A few days after the visit, demonstrations broke out. Latpadaung copper mine demonstrators near Monywa were brutally attacked and arrested by police. Following the release of Aung San Suu Kyi’s report on the copper mine investigation, many locals were hesitant and otherwise enraged by the commission’s recommendations to support the military-backed Chinese project. And, not surprisingly, many of those locals continue to protest against the project.

China also backed the construction of the Myitsone hydroelectric dam in the Kachin region. Due to public anger, the project was suspended in 2011. After the project was suspended, Thein Sein was hailed as the “great President” by the Myanmar local press. The Myanmar press rarely praises China for its huge investments and the job opportunities that Chinese officials claim to generate through economic engagement with Myanmar.

The Myanmar public believes that Western nations will one day be great partners and bring sustainable development to the country. Despite the economic sanctions, the West has assisted the Myanmar people through various NGOs and UN agencies. Chinese assistance, on the other hand, has mostly been channeled through the military regime. Though China agreed to give the Myanmar government a 30 billion yuan (US$4.2 billion) interest-free loan in September 2010, it is still difficult to find any Chinese-sponsored NGOs working inside Myanmar. Whereas western-based NGOs have been - and still are - working at the grassroots level. It is not surprising that the Myanmar people passionately welcomed President Obama when he visited last November. No Chinese leader has received a similar welcome from the people, despite extensive Chinese investment in the country.

Following the second round of peace talks between the Kachin Independence Army and Thein Sein’s peacemaking delegation in early March of this year, Khun Okkar, the United Nationalities Federal Council (UNFC) secretary, said “there are some important points missing in the joint-statement, which is crucial in the peace process, because of the host country suggestions, but we made each other understand that we ourselves will have to work out those missing points to reach peace agreement.” However, the UNFC secretary didn’t elaborate on what the missing points in the statement were. Many have speculated that China attempted to influence the talks while claiming it believed in a policy of “non-interference in internal affairs,” or what is popularly known as the ‘Beijing doctrine.’

The next round of peace talks was moved to Myikyina, the capital city of Kachin State inside Myanmar. This move was partially to restrict China’s excessive involvement. Many Myanmar ethnic groups want to limit Chinese involvement in both the peace process and in Myanmar’s domestic politics. It is important to point out that all ethnic communities and their political factions, even those living near the border with China, supported the suspension of the Myistome dam project. During the anti-dam campaign in Yangon, many, including peace activists, felt “China has made us united.” This does not necessarily mean that China needs to withdraw its investments from the country; but it does show that public support is dwindling and must be seriously considered when analyzing the China-Myanmar relationship.

Perhaps  the biggest lesson potential foreign investors in Myanmar can learn is from the Chinese investment experience in Myanmar. There is an equally valuable lesson for the Thein Sein administration too, since the previous iron fisted juntas ignored the public’s pulse and consequently rose up against it. Today, the voice of the people is hard to ignore. The recent removal of draconian censorship has allowed the daily press to become a considerable force in demanding that people have a role in decision-making. China has to understand that they can no longer make deals exclusively with the government. The people have to be involved in such negotiations. To avoid repeating China’s mistakes, investors have to be sure that deals they make with Thein Sein’s administration are transparent to the public. Simply stated, China cannot maintain its influence in Myanmar unless it convinces the Myanmar people that China is a friend worth fighting for.

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Aung Tun has worked as a journalist inside Myanmar for several years. He current works in international development in Boston, MA.

[Photo courtesy of Compfight]

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