China is hedging in Myanmar by leveraging its influence

22 April 2025

Four years after Senior General Min Aung Hlaing exploited the constitutional provisions to depose the National League for Democracy’s elected government in 2021, most external actors are still struggling to engage with Myanmar. One notable exception is China, which has largely been able to manage the risks and instability emerging from the conflict.

The junta or the State Administration Council (SAC) has increasingly relied on China for support internationally — vetoing UNSC scrutiny and criticising the ICC arrest warrants. However, Beijing’s efforts to safeguard its strategic investments and infrastructure, such as energy pipelines and rare-earth mineral supply chains, are increasingly under threat due to Myanmar’s ongoing civil war.

While it may appear that the junta enjoys Beijing’s backing, the reality is more complex. China is committed to protecting its interests in Myanmar, but it is also an important peace facilitator. Beijing has pursued a policy of diverse engagement — with the junta, NLD, and Ethnic Armed Organizations (EAOs) — to hedge among the different actors and reduce the risks of any fallout.

Chinese interests and risks in a post-coup Myanmar

China’s interests are diverse and intertwined with its economic, strategic, and security imperatives. At their core, these policies are driven by China’s developmental needs in its southwestern regions, particularly Yunnan. However, the policies are also about securing material benefits and reinforcing its strategic presence in the Indian Ocean.

Even though Myanmar’s international isolation appears to push it further closer to China, the Sit Tat and the EAOs are simultaneously engaging and contesting with China in different sectors. Beijing will be key in the execution and acceptance of elections planned by the junta.

Myanmar serves as a critical avenue for the development of Yunnan, a landlocked province that relies heavily on trade and infrastructure projects linked to its southern neighbour such as the China-Myanmar Gas pipeline. China and Myanmar share a border that is more than 2200 km long, which was settled amicably in 1960. However, the administration of border areas remains fraught due to the fluctuating influence of EAOs on the Burmese side. The clashes between the Sit Tat and the EAOs tend to send waves of refugees into Yunnan and have on occasion caused Chinese collateral damage.

Furthermore, China has invested over USD 10 billion in the Kyaukphyu deep-sea port and economic zone in Rakhine State in addition to developing the Yangon Port to overcome the "Malacca Dilemma", reducing reliance on the Strait of Malacca for energy imports and trade. By securing direct access to the Bay of Bengal, China also strengthens its strategic foothold in the Indian Ocean.

China’s economic interests are also deeply tied to Myanmar’s rich natural resources. Myanmar is the world’s third-largest source of mined rare earth, including critical medium and heavy rare earth metals essential to China’s dominance in global supply chains. Before the 2021 coup, Myanmar accounted for nearly three-fourths of China’s rare earth imports. In addition, Myanmar boasts reserves of precious stones, petroleum, and other minerals, which are vital to China, Myanmar’s largest trading partner, and its industrial and strategic goals. In 2023, despite the conflict, Myanmar exported USD 33.61 million worth of precious stones, metals, and pearls to China.

The all-out civil war in Myanmar puts Chinese infrastructure investments and any long-term strategy at risk. The future of projects under development is precarious, and the security of completed projects — such as the oil and gas pipeline — is also threatened. Similarly, even though the supply of rare-earth minerals has increased since the coup, so have the costs and risks associated with it. The growth of ‘scam centres’ along the Thai-Myanmar border, which are targeting people in the region with online and telecom frauds as well as recruiting vulnerable workers, is another emerging concern for China. Many of these centres are run by groups aligned with the junta in collaboration with Chinese syndicates. The conflict has also strengthened the illegal mining of minerals and transnational organised crimes like drug trafficking. Myanmar has emerged as the top supplier of opium and heroin since the coup and a large part of this cultivation occurs in Shan State which lies at the intersection of China, Laos, and Thailand. Therefore, while China has been the strongest external actor in the country since the coup, it is not immune from the risks of junta-rule.

Hedging through influence

China, since the times of Deng Xiaoping who cut support to the Communist Party of Burma, has followed the policy of regime stability. The Myanmar coup was reported as a ‘cabinet reshuffle’ in China. Even though the rhetoric seemed supportive of the SAC, it was far from the ideal situation for Beijing.

Although several other external actors like India and ASEAN have been denied access and communication channels with the imprisoned NLD leaders, the CCP continues to maintain party-to-party relations with the NLD — albeit not to the extent the NLD might desire. Even after the coup, the NLD congratulated the CCP on its 100th anniversary and the latter invited NLD for the Summit of Asian Political Parties in late 2021. Aung San Suu Kyi’s multiple visits (2015-2020), her support for BRI, and resumption of suspended projects under NLD government point towards Beijing’s preference for an NLD government in Myanmar over the junta or USDP rule. However, the preference for NLD or strong party-to-party relations were not enough for Beijing to step in and stop its dissolution by the SAC in 2023.

To consolidate its control, the Sit Tat is fighting wars on multiple fronts despite China pushing for ceasefires with select EAOs. The Burmese military has also been traditionally suspicious of China which is seen as a threat to security and territorial integrity. While Myanmar’s international marginalisation has pushed the SAC towards China, the Beijing-Tatmadaw partnership is one of compulsion more than comfort. Furthermore, Beijing’s protection of the SAC has revived anti-China sentiments in the public which it had worked hard to recover from during the NLD government.

Officially China follows the policy of ‘non-interference’, but over the years it has bypassed the central power to engage with different actors. As a consequence, China has cultivated strong ties with key EAOs, including the Kachin Independence Army, Arakan Army, National Democratic Alliance Army, and United Wa State Army. This approach allows China to act as a broker of stability and leverage influence with the Sit-Tat while ensuring its long-term access to Myanmar’s resources and markets. It has played a pivotal role in facilitating the 21st century Panglong Peace Conference (2016) and also helped establish the Federal Political Negotiation and Consultative Committee (FPNCC) in 2017, which represents the majority of Myanmar’s armed groups.

Even amidst the civil war, China has been a key broker and the local actors recognise its role. The FPNCC meeting in March 2023 supported China’s mediation efforts to end the domestic turmoil. Similarly, in January 2025, China successfully negotiated a ceasefire agreement between the Myanmar National Democratic Alliance Army (MNDAA) and the Sit Tat. China has emerged as one of the few actors to enjoy leverage as well as trust of most actors in Myanmar.

While China enjoys a relative edge through its ties with EAOs like UWSA and AA, Beijing is well aware of the limited influence it holds over these organisations. Although China has managed to bring parties to the table to negotiate local ceasefires, the civil war has eroded the durability of Chinese-brokered agreements whether it's regarding the repatriation of Rohingyas in Rakhine or the ceasefires between EAOs and Sit Tat. For instance, it has used its leverage to mediate between the Three Brotherhood Alliance and Sit Tat and secure ceasefires — but they have failed to last. A few groups have even attacked Chinese convoys engaged in cross-border trade.

Similarly, Beijing continued the discussions regarding the repatriation of the Rohingyas and drafted a plan in 2023 against the concerns that a new wave of genocide might be underway. Even though Dhaka and Naypyitaw are undertaking phased repatriation, the refugees are concerned for their safety and long-term guarantee of citizenship and rights. This puts Chinese investments and strategic interests linked to projects like the Khyauk Phyu Port in Rakhine State in limbo.

Cautious bets

The West’s sanctions have had limited success in deterring the SAC. Furthermore, Russia and China have vetoed the UNSC statement criticising the humanitarian situation in Myanmar and similar blocking can be expected if the UNSC seeks to pass a stronger resolution. The civil war in Myanmar will be relegated to the category of ‘forgotten conflicts’, if it hasn’t been already. The civil war is bound to turn protracted with the support of the regional states and Russia to the junta, especially in the form of arms supply, and the parallel widespread (peaceful and armed) resistance against the military.

The West and the UN continue to weigh their relationship with Myanmar in respect to the relative success or failure of the ‘democracy project’ — a project losing appeal in the West itself. On the other hand, Beijing has pursued the policy of regime stability and domestic hedging since the 1980s. The civil war has destabilised border areas, increased the costs and risks to infrastructure and investments, and fuelled organised crimes. Even though Myanmar’s international isolation appears to push it further closer to China, the Sit Tat and the EAOs are simultaneously engaging and contesting with China in different sectors. Beijing will be key in the execution and acceptance of the elections planned by the junta.

China’s post-coup strategy has been defined by pragmatism and caution. Its broader ambitions, such as the success of the CMEC, the security and development of Yunnan, and protection of the supply of rare earth metals and other minerals, remain precariously tied to the trajectory of Myanmar’s internal conflicts. Moreover, the resurgence of anti-China sentiment, alongside engagement from regional actors like ASEAN and India, has further complicated Beijing’s position. However, China is seemingly aware of the political complexity of Myanmar and appears to have hedged against different outcomes by leveraging its influence with all the relevant actors instead of backing just one player.

DISCLAIMER: All views expressed are those of the writer and do not necessarily represent that of the 9DASHLINE.com platform.

Author biography

Chetan Rana is a PhD candidate at the Centre for International Politics, Organisation, and Disarmament (CIPOD) at Jawaharlal Nehru University, New Delhi and Senior Editor at 9DASHLINE. He also holds a masters degree in Politics with specialisation in International Studies from the School of International Studies, Jawaharlal Nehru University. He writes on issues concerning the Indo-Pacific, populism, Indian foreign policy, and Myanmar. Image credit: Flickr/Syed Shameel.