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What is China’s Involvement And Stake in the Myanmar Crisis?

In the light of the Myanmar experience, countries with a great wealth of natural resources, like Indonesia, should be wary of foreign interventions.

By Harishmawan Heryadi

Many have begun to attribute the military coup in Myanmar to the presence of foreign hands. Could that be true? 

Many days have passed since the military coup took place in Myanmar. So far, there have been protests against the armed forces’ stance. Amid the protests, a new sentiment emerged, namely anti-Chinese sentiment. 

As reported by Reuters, the gas pipeline from Myanmar to China has been the target of anger from anti-coup protesters. The Chinese Embassy has also become a focus for protesters. This is due to the assumption that the military coup that took place was supported by the Beijing government. Of course, this has not been verified. In this regard, according to Reuters, Chinese Ambassador to Myanmar Chen Hai said that the current situation in Myanmar is not something that China wanted to see. He also said that China was still on good terms with the military and the former civilian government. 

Still, Beijing has not issued an explicit statement condemning the takeover by a military junta. Many other countries were more forthcoming. Among those that condemned the powergrab were members of the G7: the United States, Japan, Britain, Germany, Canada, Italy and Canada. Going beyond simply condemning, the US has imposed sanctions on the parties involved in the coup. Not only that, the United States has frozen assets connected to the military regime. 

It appears that there are two different attitudes in addressing the coup in Myanmar. There are those who strongly condemn like the US; there are also those who issue vague statements like China. There just might be a war of influence behind these two attidues. Moreover, there are economic stakes involved in the Myanmar crisis. 

Over the years, Myanmar has been known as a country led by a military junta. This country, which was under British control, was controlled by the military from 1962 to 2011. 

Isolation and sanctions

During that earlier military junta period, Myanmar experienced strict isolation from other countries, especially Western countries. In the 1980s, Western countries imposed trade and economic sanctions on Myanmar. During that period, foreign investments in Myanmar were very limited. One of the countries that became a source of foreign investment at that time was China. Since then, Myanmar has had quite cordial economic and diplomatic relations with China. 

This condition changed slightly when there was significant reform in Myanmar in 2010. At that time, there were economic and political changes in Myanmar with the hope that democracy could be created after a long period of leadership by the junta. The main sign of this was the release of Aung San Suu Kyi from house arrest after 15 years. That development altered Myanmar’s foreign relations. 

Investments began to come in not only from China but also from Southeast Asia and Korea. Gradually, foreign investment from other countries began to compete with China. Moreover, bilateral relations between Myanmar and China were hampered at a time when many large dam projects funded by China were delayed. One project was signed by China in 2013 with the previous Myanmar regime. It was reported that 90 percent of the electricity from the project would be sent to China and Thailand, sparking controversy. 

Eventually, China as the main investor in Myanmar was overtaken. In 2019, Singapore replaced China as the dominant investor with investments in a wide range of sectors including banking, construction, real-estate and arms. 

Energy Issues 

The rivalry for influence in Myanmar is likely to occur in a very significant sector, namely energy. In this context, oil and gas can be the crucial investment areas to be contested in Myanmar. 

As an illustration, Myanmar is actually a country that has abundant natural resources. In 2012, it recorded gas reserves of 10 trillion cubic feet. It has also oil reserves of 50 million barrels in 2013. Even so, isolation, sanctions, and lack of investment have rendered their development insignificant. Today, however, there is actually significant co-operation in the oil and gas sector in Myanmar. 

This cooperation is between Myanmar and China. It is mainly carried out in the oil and gas pipeline project that was launched in 2009. The project began operating in 2013 and is an important part of China’s Belt and Road Initiative. So far, this project has sent oil and gas to China through the Myanmar-China Natural Gas Pipeline and the Myanmar-China Oil Pipeline. The pipeline itself extends from the city of Kyaukpyu in Myanmar to the Yunnan region of China. 

In 2018, this route is said to have sent 3.2 billion cubic meters of gas from Myanmar to China. This oil and gas pipeline certainly provides benefits for China. Not only does it help China meet its needs, it also serves strategic purposes. Through this project Myanmar gives China an alternative route that makes it unnecessary to make use of shipping that has to go through the Malacca Strait. 

The strait itself is said to be an international shipping route dominated by the US Navy. The existence of this pipeline gives China a faster path to take and has relatively minimal potential for confrontation with the US. 

Possible Interventions 

This wealth of natural resources is certainly attractive to many other countries. For example, before China, India had already into Myanmar’s their gas wealth. After sanctions on Myanmar were slowly lifted in 2012, many international energy companies were also atrracted. Companies such as British Gas, Chevron, ConocoPhillips, ENI, Oil India, Ophir, PetroVietnam, Shell, Statoil, Total and Woodside are reportedly starting to enter the Myanmar oil market. 

These trends emerged only when the Myanmar military relaxed so that various sanctions were lifted. On the other hand, China, as Myanmar’s initial investment partner, actually enjoys a lot of relations with the military. The example of a dam project case mentioned earlier shows the strength of the relationship between China and the Myanmar military. 

The same applies to gas pipeline projects that started in 2009, before various changes took place. These illustrates how China finds it easier to succeed in its investments through the old business model of dealing with a military dictatorship. 

Moreover, recently, junta leader General Min Aung Hlaing said he would resume the hydropower project, although he did not specify which project. This statement made many wonder what the Chinese joint dam project was all about. If so, it could be a source of discussion on whether China prefers to interact with military dictators rather than civilians. This is because they can launch energy projects more easily when dealing with soldiers. 

On the other hand, other countries seem to find it easier to invest in Myanmar when they deal with a government. Some may wonder what is the issue of the struggle for energy sources in the coup drama? Of course, this is still difficult to prove today. Even so, in “Oil above Water: Economic Interdependence and Third-party Intervention,” Vincenzo Bove, Kristian Skrede Gleditsch, and Petros G. Sekeris indicate that if there is foreign intervention in a conflict, it is likely to be related to energy, which in this context is oil. In the light of the situation in Myanmar, it is not impossible that such a drama or similar conflict can occur in other resource-filled countries. 

Indonesia, as a country with an abundance of natural wealth, may be prone to conflicts involving foreign hands. Indeed, so far there have been no such signs in Indonesia. The same thing has not been fully proven in Myanmar. However, in view of the findings of Bove and his colleagues, countries rich in natural resources must always be vigilant.

Editor’s note: The views expressed in this article are the author’s and do not necessarily reflect the views of PinterPolitik.

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