Myanmar's changing ties with China

Gas flows from Myanmar, but Beijing finds goodwill is another matter

PUBLISHED : Tuesday, 06 August, 2013, 12:00am
UPDATED : Friday, 30 May, 2014, 8:27am

Along much of the new 793-kilometre natural gas pipeline linking western China to the Bay of Bengal lie dozens of new schools and clinics. The facilities, built with more than US$20 million in Chinese development aid, are evidence of Beijing's new approach to Myanmar.

Facing a Myanmese public increasing sceptical of its huge demands for natural resources, Beijing went out of its way to present itself as a friendly neighbour before gas started flowing through the pipeline last week.

Xinhua praised the pipeline as a "mutually beneficial energy project" that "carries the goodwill of the people of China and Myanmar". Chinese officials have encouraged Chinese companies involved to improve transparency. The Chinese embassy in Yangon has put project updates on its Facebook page.

But as China prepares to open an oil pipeline later this year, experts say Beijing should consider rethinking its strategy.

Myanmese complain that many of the schools and clinics built along the pipeline route with Chinese aid are empty. Perceptions of China are as negative as ever. Beijing has found that there are limits to its "soft power".

"China is very good at building things but getting endorsement locally is a different thing," said Alex Neill, a senior fellow at the International Institute of Strategic Studies. "Myanmar is a proud nation and doesn't want China to run the country."

Neill said the Myanmese are not convinced by the standard Chinese rhetoric casting the pipeline as a "win-win".

"Myanmar is wary of Chinese hegemony," Neill said. "And the leadership needs to listen closely to its people to make sure it is actually a win-win relationship."

During Myanmar's years of diplomatic isolation, China's close relationship with its ruling junta enjoyed a virtual monopoly over the country's abundant natural resources. But as the country opens up to the world and expands democracy, China has increasingly found itself crowded out by new players.

At the same time, the Myanmese have grown increasingly sceptical of China's intentions and less tolerant of their northern neighbours' demands. Myanmar's more democratic government has had to listen more closely to their complaints.

In 2011, Myanmese President Thein Sein suspended work on the controversial Myitsone Dam on the Irrawaddy River after widespread protests, citing "the people's will".

In recent months, China has redoubled its efforts to win over the Myanmese. In July, Chinese companies involved in megaprojects and the Chinese embassy in Yangon held a symposium to address public concerns over its investments in the country.

The Myanmar-China pipeline has been controversial since its inception and is a target of frequent demonstrations. It runs through insurgent ethnic minority areas, has displaced farmers and fishermen and spurred widespread suspicion over whose pockets will ultimately get lined.

The project is funded by six countries, however the China National Petroleum Corporation is responsible for 50.9 per cent of the investment. The 12 billion cubic metres expected to be exported annually will generate significant revenue for Myanmar, although critics argue energy resources are better spent domestically bolstering the Myanmar economy.

Neill said large infrastructure projects can indeed bring two nations closer, but in this case, a pipeline is not ideal. Highways and rail links, for instance, are likely to increase movement of people across borders and contribute far more to integration.

"China has a bad image in Myanmar," said Bernt Berger, head of the Asia Programme at the Institute for Security and Development Policy. "The common perception is that China is mainly interested in its own business operations.

"So far, the people living alongside the pipeline have gained little from the project." Berger said. "People have been moved off their land but in most cases neither the land, nor the quality of housing, was suitable. Compensation was far below what people needed to rebuild their lives."

Wong Aung, head of the Shwe Gas Movement, an organisation focused on raising awareness about the pipeline's social, economic and environmental impacts, said many Myanmese cannot comprehend why the government would export gas and oil to China. That is because only one in four Myanmese have electricity and most still use wood-burning cook stoves.

"Anti-Chinese sentiment is widespread, which is why China must really find a way to deal with the Myanmese directly rather than through the regime. They need to consult and talk with people; the policy of engagement is positive, but it shouldn't be tied solely to a project but rather function as a long-term strategy," Wong said.

Berger, who recently met Chinese diplomats in Myanmar, believes the charm offensive in unlikely to succeed and may even prove counterproductive.

"Ironically, the renewed efforts might make things worse on the ground," he said, noting that many people are frustrated by what they see is a refusal by Chinese companies to engage in a direct dialogue. "As long as Chinese companies do not seek to alter that perception, things are unlikely to change."